Fannie Mae to Test the Waters of Earlier Foreclosure Prevention Plan in Florida
Pre-File Mediation HELP
Does Mediation work to prevent homeowners from falling into foreclosure? Fannie Mae has been testing this theory out by offering pre-file mediation. Usual mediation can occur 8 months or so, after you have fallen behind. However pre-file mediation is a fast track way to get people help sooner, usually 4 months after you have fallen behind. It is mandatory in six of Florida’s 20 judicial circuits. The goal is to bring together the homeowner and lender face to face to resolve the delinquent mortgage status of the account.
The issues with this pre-file mediation prevention plan are the delays in getting both parties to meet face to face. Many states have passed laws in recent years that require banks to meet face to face with home owners to help speed up the mediation process.
According to a firm located in Miami, Collins Center for Public Policy, a nonprofit hired by Florida to help run mediation in the six circuit courts. The goal is to engage the homeowner and lender to resolve the matter sooner than later by ways of having mediation. The loan modification process is cumbersome enough to begin with and many homeowners are clueless as to where to start the loan modification process.
The Collins Center for Public Policy has had about 1,800 notifications of default from mortgage servicers, however only a few dozen cases have been settled. The issue is many homeowners try to do it on their own without much success because they do not fully understand the process and the guidelines the lenders go by.
However, if your loan is not guaranteed by Fannie Mae, you would not be eligible for this mediation help. The key to keeping your home is to act fast and ask for help right away. There are a lot of free servicers available and even software to guide you through the process. With many Americans still struggling to keep their home, and laws preventing many third parties in assisting homeowners, it is getting harder for homeowners to find a reliable source to turn to.
Considering Florida’s foreclosure rate compared to the national average, we are talking about 25% of all mortgages in Florida were at least 30 days behind. The national average is about 14% of all mortgages are in default, and that percentage is increasing daily.Freddie Mac is also looking at creating a fast track mediation program to help with the growing foreclosure rates in Florida and also across the country.