october 11, 2012 combating the foreclosure crisis 1
TRANSCRIPT
October 11, 2012
Combating the Foreclosure Crisis
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Overview
Mediation Program
Servicer and other outreach events
Enforcement Initiatives
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MEDIATION
PROGRAM
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Mediation Program
Nuts and BoltsEstablished by statuteAdministrative DirectiveEligibilityMediation is an automatic, opt-out program Conciliation style mediationProgram reliant on HUD approved housing
counselors to assist homeowners
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Mediation Program
Program is run by the Superior Court President Judge Vaughn is the point person in the Court Linda Carmichael is the liaison Sharon Agnew and other Prothonotaries are also involved
Delaware Dept. of Justice, Program Administrator Administers the day-to-day running of the Program and the
conferences
DVLS arranges for and assigns mediators Jacki Chacona is currently serving as the sole mediator
DSHA manages the mediation account and distributes reimbursements to housing counseling agencies and the DOJ
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Mediation Program
Goals of the new Mediation Program: Preventing unnecessary foreclosures Giving Delaware homeowners an opportunity to have
a meaningful conversation about possible non-foreclosure alternatives
Establishing a single point of contact with servicerHousing Counselors play a large role:
Assist homeowners with navigating the loan modification process;
Guide and support homeowners through the mediation conference; and
Spearhead negotiations with the lender and lender’s counsel.
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Foreclosure Timeline7
3-4 months behind Letter of Default
Notice of Intent to Foreclose (45 days before suit)
Foreclosure Suit filed
Service of Complaint by
Sheriff
Notice to Lien Holders for
posting
Mediation Conference Scheduled
Homeowner to meet with Housing
Counselor & complete COP
Homeowner submits
documents 14 days before conference
Lender submits checklist of
missing docs 7 days before conference
Homeowner files an Answer or responsive pleading
Appearance and participation in
mediation conference
Complete a Mediation
Record
Reduce any non-foreclosure
agreement to writing
Proceed accordingly
based on outcome of conference
Foreclosure Data8
New Castle Kent Sussex Statewide
2009 3828 1228 1562 6618
2010 3344 1055 1424 5823
2011 3778 936 1198 5912
2012 478 178 213 869
500
1500
2500
3500
4500
5500
6500
Foreclosure Filings by County
Num
ber
of
Case
s
Foreclosure Data9
January Feb. March April May June July August Sept.0
50
100
150
200
250
300
350
400
450
500Statewide Foreclosure Filings by Month 2012
SussexKent New Castle
433
15 19 37 55
73 57
77
103
Mediation Program Statistics
136 eligible foreclosure actions, representing 24% of all foreclosure actions filed statewide since the inception of the program;
30 homeowners have filed certificates indicating a desire to participate in mediation;
34 mediation conferences have been held; 15 cases have been continued pending further negotiations
or have reached a non-foreclosure resolution through mediation;
93.33% of the cases which have been continued or resolved involved a housing counselor;
19 cases have proceeded on to judicial foreclosure, 90% of these due to failure of the homeowner to appear for scheduled mediation;
Overall, the Mediation Program has a 59.37% participation rate.
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SERVICER EVENTS
AND
OTHER OUTREACH
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Servicer Events
Quarterly eventsSince 2009 we have held over 25 workshops
bringing together lenders, homeowners, housing counselors, and representatives of the Attorney General’s Office
Workshops provide information about programs available to assist struggling homeowners
Facilitate on-site face to face meetings between homeowners and mortgage servicing banks
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Next Servicer Events
WEDNESDAY, NOVEMBER 14, 2012 Session #1
First State Community Action Center308 N. Railroad AvenueGeorgetown, DE 19947Outreach from 11:00am to 2:00pmEducational Presentation beginning at 12:45pm
Session #2Milford Senior Center111 Park Avenue, Milford, DE 19963Outreach from 5:00pm to 8:00pmEducational Presentation beginning at 6:30pm
THURSDAY, NOVEMBER 15, 2012 Sheraton Wilmington South
365 Airport RoadNew Castle, DE 19720Outreach from 11:00am to 8:00pmEducational Presentations at 12:30pm and 6:00pm
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Community Outreach
The Office of Foreclosure Prevention and Financial Education
Monthly town hall meetings in all three counties
Information and resources for struggling homeowners Review of assistance programs Information regarding loan modifications Tools to avoid foreclosure rescue scams
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ENFORCEMENT
INITIATIVES
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Mortgage Fraud
Scope of Enforcement Individual Mortgage Brokers Foreclosure Rescue Scams Improper Mortgage Servicing Activities Deceptive Practices related to the Ownership of
Mortgages Abuses related to the Securitization of Mortgages
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MERS Lawsuit
Allegations MERS obscures important information from borrowers and what is
available to borrowers is frequently inaccurate. MERS acts without authority MERS is a “front” organization that does not enforce its own rules
Settlement Terms Creating an easy way for homeowners to find out who owns their
mortgage. Reducing the chances of fraudulent foreclosures. Increasing the transparency of the foreclosure process. Improving the accuracy of MERS’ records. Increasing oversight and training.
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Bank of New York Mellon/Bank of America Litigation
Litigation in New York State Court seeking judicial approval of a proposed $8.5 billion settlement involving 530 different residential mortgage backed securities trusts
If approved, settlement would resolve investor claims related to breaches of the agreements governing the trusts at issue
Protecting the interests of unrepresented Delaware investors and homeowners and the integrity of the market as a whole
Additional transparency from the parties seeking judicial approval of the settlement
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Ongoing Enforcement Efforts
The Delaware DOJ continues to pursue cases in this area
Investigate allegations of improper conduct in the mortgage space
Use of national mortgage settlement funds to combat financial fraud
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National Mortgage Settlement
$26 billion settlementJoint state-federal investigationDelaware Department of Justice served on the
executive committee of investigating attorneys general
Settlement resolved claims related to improper mortgage servicing practices of five largest mortgage servicing banks in nation
Delaware’s share of settlement approximately $11.7 million
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National Mortgage Settlement
Funds to support: Enforcement Education and Outreach Mediation program
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Thank You!
Please feel free to contact me if you have questions. My contact information is below:
Gregory C. StrongDirector, Consumer Protection Unit
Deputy Attorney General820 N. French Street
Wilmington, DE 19801(302) 577-8504
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