Delaware Extends Foreclosure Mediation Program

Effective immediately, Delaware has extended the Delaware Automatic Residential Mortgage Foreclosure Mediation Program. Previously, the foreclosure mediation program was to sunset January 18, 2018. Through the extension, the program will continue to run until January 18, 2020.

The foreclosure mediation program was designed to find solutions between the borrower and the lender when foreclosure is looming. The program allows for parties on both sides to meet face-to-face and conduct a conflict resolution mediation through the assistance of a HUD-approved Housing Counselor. The program, due to the simplicity of the process and financial incentives, has garnered a 53.82% overall participation out of those individuals who applied to commence mediation. Presently, the success of reaching a non-foreclosure resolution for those who participate is at a resounding 63.21%.

Success in the program can come in two different forms. First, the borrower may seek and find a way to remain in his or her home. This can be achieved by: (1) finding an agreeable loan terms modification; (2) creating a loan repayment plan that allows for both parties to meet their financial objectives; or (3) entering into a forbearance agreement. Second, as an alternative to staying in the home the borrower may find that voluntarily exiting the home may be more beneficial for both parties. This can be achieved by either conducting a lender-approved short sale or transferring a deed in lieu to the lender in exchange for debt cancellation. It is due to the success of the program in creating for borrowers and lenders options that were previously unavailable and providing financial benefits for all parties that it was extended for a further two years.

 

  • Regulatory Compliance Consultant
  • Lexington, MA
  • 781-402-6457

Julio Suarez, JD, is a regulatory compliance consultant with Bankers Advisory. He is a graduate of the University of Central Florida and earned his juris doctor at the New England School of Law.

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