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Problems with foreclosure mediation leads to complaints

A program set up to prevent foreclosures provides greater access to financial records for bank attorneys than defense lawyers in Pinellas and Pasco counties, those defending homeowners say.

Since the mediation program started in August, defense attorneys say they haven't had electronic access to the records even after their clients provided the court-ordered information to mediators. That has put them at an unfair disadvantage.

Defense attorneys also say banks are dictating the dates and times of the mediation sessions without checking the schedules of opposing counsel and homeowners.

Mark Stopa, a St. Petersburg foreclosure defense attorney, said the lack of access to records gives banks an upper hand in the process.

"It is a problem," he said. "The whole process is inequitable and not doing what it was intended. I am not happy or excited about the process."

In Hillsborough County, defense attorneys receive access to the case information once they prove representation.

Ron Stuart, spokesman for the Pinellas-Pasco judicial circuit, said the access issue is being remedied. He urged patience as the remaining glitches are being resolved. He acknowledged that court officials knew about the different levels of access when the program started. Clearwater-based Mediation Managers Inc. operates the program in Pinellas and Pasco counties.

"We were going into an avenue that was all new to us," Stuart said. "It's in the hands of Mediation Managers. They're trying to get it solved as quickly as they can."

The high court ordered the state's 20 judicial circuits in late 2009 to sponsor mediation sessions between homeowners and lenders to reduce foreclosures. The program applies to owner-occupied, residential properties and aims for a quick resolution.

Lenders pay a $750 fee for each case. A successful mediation could lead to a modification of the mortgage loan, such as a lower interest rate or a time extension for the borrower. Some people still will lose their homes.

Mediation Managers immediately notified court officials about the access problem when defense attorneys complained last month, said Dick Rahter, the nonprofit's president. The technology needs to be improved so defense attorneys can get access to information about their cases, but not private records in all cases, he added.

Nobody, Rahter said, anticipated this problem.

"The policy is being looked at and may change in the near future," he said. "I was always concerned about that from the beginning."

Bank attorneys, he said, are not controlling the scheduling process. Some problems developed when defense lawyers didn't notify the mediation program about representing a client, Rahter said.

He acknowledged that some scheduling conflicts have slipped through the cracks.

"It's kind of like a juggling act," Rahter stressed. "We're doing our best."

Mark Puente can be reached at [email protected] or (727) 893-8459.

Problems with foreclosure mediation leads to complaints 01/27/11 [Last modified: Thursday, January 27, 2011 9:16pm]
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