PRO Masterminds: The State of the Mortgage Foreclosure Mediation Program from the Mediator's Point of View

I had the opportunity to speak with the Masterminds group of the Pinellas Realtors' Organiztion ("PRO") this morning. I was delighted to have a lively and very engaged, larger than expected crowd. My topic was "The State of Residential Mortgage Foreclosure Mediation from the Mediator's Point of View," and I quickly learned that the professional realtors have limited knowledge of the mediation process but loads of experience in dealing with the banks on short sales. I am very sure I learned as much from them today about the realty of the short sale market as they did from me on mediation.


Some of the topics we discussed:

1. The difference between arbitration and mediation
2. Pre-suit v. Post Suit mediation
3. The need to provide current (within 60 days) documentation --- the more thorough and complete, the more likely there will be a mediation resolution
4. Short Sales, Short Sales, Short Sales
• Short sales need to be approved by the bank in order for the deficiency to be waived
• The banks expect the property to be marketed for 90 days before considering a short sale
• A licensed Realtor must be engaged to market the property and that realtor needs to work closely with the bank to ensure the necessary information is in the bank's hand when the bank considers a short sale 
• Short sales, like other modifications and forgiveness programs, are designed to address hardship. Homeowners are not entitled to a short sale simply because they want to sell below mortgage amount
5. Multiple liens complicate any modification or short sale and the borrower must be actively engaged in the discussion with second and more junior lien holders to facilitate a solution

Unfortunately, time was short and we did not get to discuss tenants in foreclosed properties or other opportunities for realtors and investors in this less than orderly residential real estate market. 

I agreed to chat with the group again in a couple of months. 

Many thanks to Linda Goldfarb of LSG Consulting Services for arranging the event this morning. She has a mastermind meeting each month. The 35+ attendees were from both sides of the bay ---- a wonderful knowledge sharing opportunity for all.