U.S. DEPARTMENT OF JUSTICE
ACCESS TO JUSTICE INITIATIVE
FORECLOSURE MEDIATION:
EMERGING RESEARCH AND EVALUATION PRACTICES
A Report from the March 7, 2011, Workshop at the U.S. Department of Justice
Melanca Clark
Daniel Olmos
Access to Justice Initiative
U.S. Department of Justice
Washington, D.C.
December 2011
About the Access to Justice Initiative
The U.S. Department of Justice established the Access to Justice Initiative (ATJ) in March 2010 to address
the access-to-justice crisis in the criminal and civil justice system. ATJ’s mission is to help the justice
system efficiently deliver outcomes that are fair and accessible to all, irrespective of wealth and status.
The Initiative’s staff works within the Department of Justice, across federal agencies, and with state,
local, and tribal justice system stakeholders to increase access to counsel and legal assistance and to
improve the justice delivery systems that serve people who are unable to afford lawyers.
ATJ is guided by three principles:
• Promoting Accessibility — eliminating barriers that prevent people from understanding and
exercising their rights.
• Ensuring Fairness — delivering fair and just outcomes for all parties, including those facing
financial and other disadvantages.
• Increasing Efficiency — delivering fair and just outcomes effectively, without waste or
duplication.
To translate these principles into action, ATJ pursues strategies to leverage and better allocate justice
resources, and works to:
• Advance new statutory, policy, and practice changes that support development of quality
indigent defense and civil legal aid delivery systems at the state and federal level;
• Promote less lawyer-intensive and court-intensive solutions to legal problems; and
• Expand research on innovative strategies to close the gap between the need for, and the
availability of, quality legal assistance.
Acknowledgements
We would like to thank all those who attended the Foreclosure Mediation: Emerging Research and
Evaluation Practices Workshop in March 2011. Workshop participants brought a wealth of experience
and information to the convening. Without their willingness to share their experiences and insights, the
convening would not have been the success that it was. We would also like to thank our colleagues at
the Access to Justice Initiative. Senior Counselor Mark Childress and Deputy Counselor Deborah Leff
offered invaluable guidance and support on this project, and intern Shakira Mack provided much-
needed assistance in finalizing the report. We also gratefully acknowledge Ira Goldstein’s thoughtful
contributions to the substance of the report and to the Workshop itself.
The Recommendations for Federal Action contained in this document are those of the non-federal
Workshop participants and do not necessarily represent the views of the authors or the official position
or policies of the U.S. Government.
Melanca Clark
Daniel Olmos
Senior Counsel
Senior Counsel
Access to Justice Initiative
Access to Justice Initiative
U.S. Department of Justice
U.S. Department of Justice
TABLE OF CONTENTS
EXECUTIVE SUMMARY ......................................................................................................................................... 1
INTRODUCTION...................................................................................................................................... 5
BACKGROUND......................................................................................................................................... 6
A. THE EMERGENCE OF FORECLOSURE MEDIATION PROGRAMS ............................................................ 6
B. EXISTING RESEARCH ............................................................................................................................... 8
TOWARD A COMMON VOCABULARY OF EVALUATION............................................................. 9
A. IDENTIFYING BASIC RESEARCH QUESTIONS AND RELATED METRICS .................................................. 9
Program Characteristics............................................................................................................................................. 9
Jurisdiction’s Foreclosure Dimensions ................................................................................................................ 9
Participation..................................................................................................................................................................10
Outcomes........................................................................................................................................................................11
Sustainability ................................................................................................................................................................ 12
Access............................................................................................................................................................................... 12
Administrative Impact.............................................................................................................................................. 13
Impact of Housing Counselors...............................................................................................................................13
Impact of Legal Assistance...................................................................................................................................... 14
B.
D
ATA SOURCES – RESOURCES & CHALLENGES ...................................................................................... 17
Court Administrative Databases...........................................................................................................................17
City/County Databases ............................................................................................................................................. 17
Counselor and Mediator Records.........................................................................................................................18
Observation and Interviews ................................................................................................................................... 18
Federal Data..................................................................................................................................................................19
Confidentiality Concerns..........................................................................................................................................19
SUMMARY OF WORKSHOP PROCEEDINGS ..................................................................................20
PANEL ONE - FRAMING THE ISSUE: FORECLOSURE MEDIATION PROGRAM STAKEHOLDERS DISCUSS
PROGRAM OBJECTIVES AND RESEARCH AND EVALUATION NEEDS.................................................................... 20
PANEL TWO - RESEARCHERS DISCUSS CHALLENGES AND LESSONS LEARNED FROM EVALUATION OF
FORECLOSURE MEDIATION PROGRAMS AND RELATED FORECLOSURE PREVENTION INTERVENTIONS. ....... 26
SUMMARY OF KEYNOTE REMARKS BY DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
ASSISTANT SECRETARY FOR POLICY DEVELOPMENT AND RESEARCH RAPHAEL BOSTIC................................ 32
RECOMMENDATIONS FOR FEDERAL ACTION.............................................................................34
CONCLUSION .........................................................................................................................................35
RESOURCE LIST ....................................................................................................................................37
APPENDIX...............................................................................................................................................39
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Foreclosure Mediation: Emerging Research and Evaluation Practices
1
EXECUTIVE SUMMARY
Federal, state, and local law and policy makers have initiated a broad array of interventions
to counter the foreclosure pandemic, including loan modification programs (such as the
federal Home Affordable Modification Program (HAMP)), mortgage payment assistance
and principal reduction programs, counseling assistance, funds to promote neighborhood
stabilization, and regulatory reform. One vehicle that has the potential to coordinate a
number of these foreclosure mitigation tools is foreclosure mediation, a forum in which a
neutral third-party helps to facilitate an alternative to foreclosure in circumstances where
such an outcome is feasible. Jurisdictions around the country are increasingly offering, or
even requiring, mediation as a device through which lenders and homeowners can attempt
to reach mutually agreeable and beneficial alternatives to foreclosure. The challenge for
communities weighing the mediation option has been to assess what works and to identify
reliable processes that are effective.
In March 2011, the U.S. Department of Justice’s Access to Justice Initiative convened a
working group of foreclosure mediation program administrators, researchers, and other
stakeholders. The Workshop was designed to achieve two goals: (1) to illuminate best
practices for research and evaluation of foreclosure mediation programs and related
interventions, and (2) to connect administrators interested in having their programs
evaluated with researchers equipped to perform evaluations, as well as funders, advocates,
and representatives from government agencies and the lending community. The Workshop
also presented an opportunity to hear participants’ recommendations for actions the
federal government could take to support the development of well-structured foreclosure
mediation programs based upon an evidence-based model.
Workshop participants agreed that, first and foremost, a common vocabulary of evaluation
is needed for evaluating program success. Common evaluation metrics will help provide a
better national picture of the program designs that are most effective, and can also ease the
burden of collecting data. Gathering data on the following metrics, though preliminary, are
essential:
• Program Characteristics
• Foreclosure Rate
• Participation Rate
• Outcomes
• Sustainability
• Administrative Impact
• Access
• Availability of counseling and legal services
2
Executive Summary
The chart below identifies suggested data points that can be used to measure the above key
foreclosure mediation program metrics.
Metrics
Measures
Computations
Data Sources
Program
•
Eligibility requirements
Qualitative assessment
•
Applicable statutes and
Characteristics
•
Opt-in/Opt-out structure
rules
• Mandatory Participation
• Borrower questionnaire
•
Paperwork requirements
•
Interviews
•
Compliance structure
Foreclosure Rate
•
Total number of foreclosures (owner
occupied, single family, etc.)
• Total number of properties (owner
occupied, single family, etc.) in
jurisdiction
Foreclosure rate = total number of
foreclosures in jurisdiction/total number of
properties in jurisdiction
•
City/county databases
Participation Rate
• Total number of foreclosures
•
Foreclosures eligible for intervention
• Total program participants
Participation Rate 1= Number participating
in program/Foreclosures eligible for
intervention
Participation Rate 2 = Number participating
in program/ Total number foreclosures
• Court administrative
databases
Outcomes
•
Total program participants
•
Total agreements reached
• Type of agreement
1. Lost Home (liquidation)
Deed in lieu
Short sale
Graceful exit
2. Retained Home (non-liquidation)
Loan modification
Forbearance plan
Partial claim -
reinstatement
Outcomes 1 = agreements reached/total
program participants
Outcomes 2 =liquidation agreements/ total
agreements reached
Outcome 3 = non-liquidation agreements/
total agreements reached
•
Court administrative
databases
• Counselor/mediator
records
• Observation and
interviews
Sustainability
•
Number of participants who retained
home
• Number of participants who remained
in home for defined period of time after
case closed
Sustainability = resolutions for which
subsequent foreclosures, sales, mortgages,
or other liens have been filed/ total number
of resolutions (using at least one year time
period from date of initial resolution)
•
City/county databases
•
Court administrative
databases
• Counselor/mediator
records
•
Observation and
interviews
Administrative
•
Number of times each case “touches”
Administrative Impact 1 = median days
•
City/county databases
Impact
program
• Number of days cases take until
resolution (i.e., agreement or reentry
into foreclosure process)
• Number of days cases take until
resolution without mediation
cases take until resolution (agreement or
reentry into foreclosure process)
Administrative impact 2 = median number
times each case “touches” program
Administrative impact 3 = median days
foreclosure process without mediation
intervention
•
Court administrative
databases
• Federal data
Administrative impact 4 = administrative
impact 1 /administrative impact 3
Access
•
Total program participants
•
Participants’ race/ethnicity
• Participants’ income
• Loan to value ratio
•
Delinquency
Computations require a reasonably
sophisticated set of statistical procedures
including statistical controls for variables
relevant to access/outcome (e.g., extent to
which a loan exceeds the value of the
property, degree of delinquency, level of
income).
•
City/county databases
•
Court administrative
databases
• Federal data
Representation/
•
Total program participants
Counseling rate = Participants assisted by
•
Court administrative
Counseling
•
Participants assisted by counselors
counselors/total program participants
databases
• Participants assisted by lawyers
Representation rate = Participants assisted
• Court administrative
databases
by lawyers/ total program participants
•
Counselor/mediator
records
3
Foreclosure Mediation: Emerging Research and Evaluation Practices
Workshop participants also discussed what might be done at the court, city, county, and
federal government levels to ease collection of relevant data.
This report documents the themes, solutions, and challenges for research and evaluation
identified at the Workshop, recommendations for action, and provides a summary of the
productive panel discussions held during the one-day convening.
The report also sets forth the Workshop participants’ consensus recommendations urging
the federal government to support the research and evaluation of foreclosure mediation
programs. Participants felt strongly that a more robust evidence base supported by
research should prompt the federal government to take additional steps to support well-
structured foreclosure mediation programs. They had several recommendations for ways
in which the federal government could facilitate the development and proliferation of
foreclosure mediation programs based upon an evidence-based model. Their
recommendations for action included:
• Supporting research and evaluation of state and local foreclosure mediation
programs through funding and technical assistance.
• Establishing federal guidelines for foreclosure mediation programs, and providing
technical assistance to assist state and local programs to meet them.
• Funding, on a matching basis, mediation programs that meet established federal
guidelines.
• Establishing a template that contains uniform data points for collection that
foreclosure programs can adopt.
• Requiring that federally-backed loans go through mediation before foreclosure can
take place.
• Improving escalation processes for federal loan modification programs to allow
federal intervention in individual foreclosure mediation cases where necessary to
achieve an agreement.
• Encouraging banking regulators to allow states to implement mediation
interventions without the threat of intervention by the banking industry.
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Foreclosure Mediation: Emerging Research and Evaluation Practices
INTRODUCTION
The loss of a home to foreclosure can be devastating for a family. In addition to losing what
is often their most significant asset, families are uprooted from community support
systems and may find themselves with no place to go. The losses extend beyond individual
families; foreclosures destabilize entire neighborhoods through declines in surrounding
property values, loss of tax revenue, and blight.
For millions of homeowners and their families who are at risk of foreclosure, mediation
programs offer an opportunity to evaluate their options and appraise possible alternatives
to losing their homes. Well-structured foreclosure mediation programs that are designed
to take advantage of available resources at the local, state, and federal levels can be
valuable and even essential tools as jurisdictions around the country seek ways to combat
the foreclosure crisis.
Although the impact of well-crafted programs appears promising, only a few jurisdictions
have engaged in an in-depth study of program outcomes, and to date there has been no
comprehensive study comparing outcomes for homeowners in mediation to similarly-
situated homeowners who have not had the benefit of mediation. As foreclosure mediation
programs expand and mature across the country, research is needed to assess the
effectiveness of this particular intervention (both within and across jurisdictions, and
including programs’ cost-effectiveness for the jurisdiction involved), as well as the real and
comparative impact of particular program features (e.g., pre-foreclosure filing mediation
versus post, mandatory versus voluntary participation, sanctions for failure by participants
to comply with program rules, housing counseling assistance, legal assistance, etc.).
In light of the immediate need for research in the field, the Access to Justice Initiative of the
U.S. Department of Justice convened, on March 7, 2011, a workshop to explore best
practices for research and evaluation of foreclosure mediation programs and related
interventions, and to facilitate connections between administrators interested in the
evaluation of their programs and researchers with the expertise to perform such analysis.
The Workshop brought together more than 40 researchers, foreclosure mediation program
administrators, advocates, and private foundations from around the country to discuss
methodologies for assessing the impact of foreclosure mediation programs, the challenges
they face, and ideas for advancing the research agenda at the local, state, and federal level.
Representatives from the U.S. Department of Justice, the U.S. Department of Housing and
Urban Development (HUD), the Federal Reserve Board, Fannie Mae, and NeighborWorks
also attended the workshop.
6
Introduction
This report is intended to (1) summarize the March 7, 2011, Workshop proceedings, (2)
compile the existing foreclosure mediation research and resources, and (3) provide an
informational resource for existing programs around the country as well as for
jurisdictions that are attempting to establish foreclosure mediation programs that fit their
needs.
BACKGROUND
A. The Emergence of Foreclosure Mediation Programs
In the face of the foreclosure pandemic, many jurisdictions around the country are offering
mediation programs to enhance opportunities for lenders
1
and homeowners to reach
mutually agreeable and beneficial alternatives to foreclosure. Based on the early success of
foreclosure mediation programs like those in Philadelphia and Connecticut, local and
statewide policy makers in a variety of jurisdictions are realizing foreclosure mediation’s
potential to coordinate many already-existing foreclosure mitigation tools such as loan
modification programs (including the federal Home Affordable Modification Program
(HAMP)), mortgage payment assistance and principal reduction programs, counseling
assistance, funds to promote neighborhood stabilization, and regulatory reform.
Currently, more than 30 foreclosure mediation programs have been created in at least 25
states, with several programs in existence for over two years.
Although many programs are still finding their footing, outcomes from several established
programs appear impressive, with some boasting over 70 percent settlement rates with
approximately 60 percent of homeowners reaching settlements that allow them to remain
in their homes. Mediation programs have the potential to decrease the number of defaults
resulting in foreclosure, increase the likelihood that mortgage terms can be renegotiated,
and facilitate “graceful exits” by negotiating short sales, deeds-in-lieu of foreclosure (where
the homeowner deeds the home to the lender in exchange for a release of liabilities under
the mortgage), or other alternatives for homeowners who are unable to keep their homes.
On November 19, 2010, foreclosure mediation programs were highlighted at a Middle Class
Task Force event at the White House co-hosted by the Office of the Vice President and the
Access to Justice Initiative. The event included a panel in which Judge Annette Rizzo from
the Philadelphia Court of Common Pleas described the benefits of the mediation program
she oversees, HUD General Counsel Helen Kanovsky discussed the promise of foreclosure
mediation, and homeowner Phyllis Shimmin recounted how the Cuyahoga County, Ohio
foreclosure mediation program saved her family’s home after her husband lost his job due
to the ongoing recession.
1
The term “lenders” is used in this report to refer collectively to lenders as well as servicers, who collect and
process loan payments during the life of a loan on behalf of lenders.
Foreclosure Mediation: Emerging Research and Evaluation Practices
7
Several additional mediation-related resources were announced in conjunction with the
November 19 event. The Access to Justice Initiative and HUD issued a joint report
identifying emerging strategies for effective foreclosure mediation programs such as well-
trained housing counselors and pro bono attorneys who can counsel and support
homeowners throughout the mediation process.
2
To assist jurisdictions that are
developing or expanding mediation programs, the report describes several features that
appear to have a positive impact on program effectiveness, including the initiation of
3
mediation before a foreclosure filing is made. The report also lists existing foreclosure
mediation programs that are interested in sharing their experiences with other program
stakeholders throughout the country.
In addition, HUD announced a new training webinar that highlights strategies and
resources for avoiding foreclosure.
4
The training, which is aimed at a wide variety of
audiences including homeowners, housing counselors, pro bono attorneys, and mediators,
includes topics such as accessing housing counseling resources, finding state-specific
foreclosure prevention resources, avoiding foreclosure rescue scams, and understanding
federal foreclosure prevention programs. HUD also provided guidance on the use of
Community Development Block Grant and Neighborhood Stabilization Funds for housing
counseling, a resource that can increase the effectiveness of foreclosure mediation
programs.
5
In addition to these efforts, NeighborWorks, a national non-profit organization established
by Congress and funded by Congressional appropriations, debuted a foreclosure mediation
workshop at the NeighborWorks Training Institute in December 2010. NeighborWorks is
one of the largest funders of foreclosure-mitigation counseling in the nation, and is the
administrator of the National Foreclosure Mitigation Counseling program.
2
U.S. Department of Justice, Access to Justice Initiative, U.S. Department of Housing and Urban Development,
2011. Emerging Strategies for Effective Foreclosure Mediation Programs, Washington, D.C.: U.S. Department of
Justice, Access to Justice Initiative, U.S. Department of Housing and Urban Development. Available at
http://www.justice.gov/atj/effective-mediation-prog-strategies.pdf.
3
See Carrie Bay, Fannie Mae Updates Policy on Foreclosure Mediation in Florida, DSnews.com, Sept. 13, 2010
http://www.dsnews.com/articles/fannie-mae-updates-policy-on-foreclosure-mediation-in-florida-2010-09-13 (for a
description of Fannie Mae’s pre-filing foreclosure mediation program).
4
Helen Kanovsky, U.S. Department of Housing and Urban Development, Office of Insured Housing, How to
Avoid Foreclosure, Webinar, 43:45, December 7, 2010, http://player.theplatform.com/ps/player/pds/fJ8kN-
D0ot?pid=UlAs5ep7wcfL6hwRfAPsXn58qdUrlgAF.
5
Marquez, Mercedes, to All CDBG Grantees and All CPD Field Office Directors. Memorandum regarding
Housing Counseling under the Community Development Block Grant (CDBG) and Neighborhood Stabilization
Programs (NSP), November 19, 2010, U.S Department of Housing and Urban Development. Available at
http://
www.hud.gov/offices/cpd/communitydevelopment/programs/pdf/housing_counseling.pdf.
8
Background
B. Existing Research
In June 2009, Workshop participants Alon Cohen and Andrew Jakabovics published a
report entitled It’s Time we Talked: Mandatory Mediation in the Foreclosure Process for the
Center for American Progress.
6
The report surveyed emerging programs around the
country, although there was little data to report. The report did note that it appeared that
mandatory programs like Philadelphia’s were seeing much higher participation rates than
opt-in programs like Connecticut’s.
7
The report also described early mediation efforts in
non-judicial jurisdictions such as California and Nevada. Although there was little data at
the time, the 2009 report did recommend federal support of mediation through, inter alia,
explicit guidance that Community Development Block Grants could be used to support
mediation programs and a requirement of mediation before residences with federally-
insured mortgages could be foreclosed upon.
In June 2010, Cohen and Jakabovics published Now We’re Talking: A Look at Current State-
Based Foreclosure Mediation Programs and How to Bring Them to Scale, which was the first
comprehensive analysis of the existing data for foreclosure mediation programs around the
country.
8
According to the report, Connecticut, which switched from opt-in to automatic
scheduling in July 2009, saw 74 percent of its mediated cases reach settlement (60 percent
staying in their homes, and 14 percent negotiating a “graceful exit”). The report contrasted
those results with the statewide opt-in program in New Jersey, which had a 50 percent
settlement rate for mediation participants, although only roughly 13 percent of eligible
homeowners participated in the program. Nevada, a non-judicial state with an opt-in
program, had a 21 percent participation rate. Based upon the data from these and other
programs around the country, and given the positive results that the programs had
demonstrated, Cohen and Jakabovics recommended that (1) opt-in programs become
mandatory or automatic scheduling programs, (2) local programs be expanded statewide,
and (3) states with no programs study ways to implement mediation.
On June 14, 2011, Workshop Moderator Ira Goldstein of The Reinvestment Fund, a
community investment organization in Philadelphia, released a detailed evaluation of the
Philadelphia mediation program.
9
The report, based upon data from the first three years of
6
Jakabovics, Andrew and Alon Cohen, It’s Time We Talked: Mandatory Mediation in the Foreclosure Process,
Washington, D.C.: Center for American Progress 2009. Available at
http://www.americanprogress.org/issues/2009/06/time_we_talked.html.
7
Mediation programs generally follow one of two models for homeowner participation: an opt-in process,
where the homeowner is notified of his or her eligibility but must affirmatively request mediation before
being entered into the program; or an automatically scheduled, or opt-out, process, where homeowners who
receive a notice that foreclosure has begun are automatically scheduled for a mediation session.
8
Jakabovics, Andrew and Alon Cohen, Now We’re Talking: A Look at Current State-Based Foreclosure
Mediation Programs and How to Bring Them to Scale, Washington, D.C.: Center for American Progress 2010.
Available at
http://www.americanprogress.org/issues/2010/06/pdf/foreclosure_mediation.pdf.
9
Goldstein, Ira and Colin Weidig, Philadelphia Residential Mortgage Foreclosure Diversion Program:
Foreclosure Mediation: Emerging Research and Evaluation Practices
9
the program, is the most detailed analysis to date of the outcomes that mediation programs
have produced. Philadelphia’s program, an automatic or mandatory program, had a 70
percent participation rate, and 38 percent of participants who received foreclosure notices
after the start of the program reached agreements with their lenders to stay in their homes.
Eighty percent of the cases resolved in some fashion with two court appearances or less. In
addition to these findings, the report states that 85 percent of homeowners who reached an
agreement during the first year of the program remained in their home as of March 2011,
and that participation and agreement rates were unaffected by race, ethnicity, or home
value.
Toward a Common Vocabulary of Evaluation
A. Identifying basic research questions and related metrics
Participants at the Workshop agreed that researchers must have a common vocabulary of
evaluation to assess program success. Common evaluation metrics will help provide a
better national picture of which program designs are most effective, and can also ease the
burden of collecting data on program administrators. Gathering data on the following
preliminary set of metrics is essential.
Program Characteristics
How does the program operate? Is it a pre-filing program, or are mediations only scheduled
after a foreclosure notice is filed? Is it mediation, conciliation, or a hybrid? Do
homeowners have to opt-in to the program? Is lender participation required? Who is
involved in the process? Are attorneys and/or housing counselors provided? What are the
program requirements (e.g., good faith participation, paperwork , etc.)? And, what are the
repercussions for program participants, if any, if program requirements are not complied
with (i.e., what is the program compliance structure)?
Suggested sources of data/information: Applicable statutes, regulations, court rules, and
interviews with subject matter experts who may be able to highlight any differences
between the policy and how the process actually operates.
Jurisdiction’s Foreclosure Dimensions
How big is the foreclosure problem in the relevant jurisdiction? What portion of that
problem is the intervention designed to address (i.e., who is eligible for participation in the
program and what portion of all homeowners in foreclosure does that constitute)?
Initial Report of Findings, Philadelphia, PA: The Reinvestment Fund of the Philadelphia Residential Mortgage
Foreclosure Diversion Program 2011. Available at
http://www.fhcsp.com/pdf/Foreclosure_Diversion_Initial_Report.pdf.
10
Toward a Common Vocabulary of Evaluation
The first question can be addressed by taking a tally of the number of people who are
subject to the action the intervention is designed to address.
The second question turns on the eligibility requirements of the program. For example, a
program may require that, in order to participate in mediation, the borrower must be the
owner/occupier of the collateral property; must be a resident for at least three years;
and/or must have a particular kind of mortgage (e.g., an ARM or other problematic loan
product). Once the requirements are identified, a data source reflecting these requirements
must be obtained and linked to the foreclosure filings.
Suggested sources of data/information: Records reflecting the number of foreclosure
actions filed in court over a given time period (assuming that the intervention is operating
in a judicial foreclosure state); records from a county assessor or recorder of deeds; or
other private market sources and databases.
10
A review of these data allows for an
explication of the (1) universe of the problem; (2) number of people who are eligible for
the intervention; and (3) percentage of homeowners eligible pursuant to the program’s
criteria and rules. In non-judicial states, there are often notice requirements which may
become a corollary data source.
Participation
Who does/does not participate in the program? What percentage of all eligible people in
foreclosure participate in mediation? The participation rate should be a straightforward
computation:
Participation Rate = # participating
total eligible to participate
Participation rates can also be computed as a percentage of all foreclosures in the
community in order to obtain a broader picture of the program’s impact.
Participation Rate = # participating
total foreclosures
Additional information regarding the specific characteristics of eligible and participating
homeowners may also be of interest. Obtaining this data can be a heavy lift under most
circumstances, because individualized characteristics (e.g., household income, number of
people in the home, race/ethnicity of homeowner, etc.) generally are not recorded
10
One option is the RealQuest database, a product of CoreLogic. RealQuest is an online subscription-based
database containing detailed property sale and mortgage transaction information. RealQuest has nationwide
coverage (although the depth of coverage varies from place to place).
11
Foreclosure Mediation: Emerging Research and Evaluation Practices
anywhere that is publicly accessible. Accordingly, the best option for obtaining this kind of
data may be to use geography as a proxy for individualized characteristics. Stated
differently, rather than being able to define homeowner X as a low-income homeowner, the
description may be of the race, ethnicity, or income level statistics of areas within which
homeowners live.
Suggested sources of data/information: Census’s American Community Survey (ACS) data
which are now available at relatively small geography points (Census tract and/or block
group, depending upon the indicator) on an annual basis. As the program has more
personal contact with the homeowner, surveying homeowners with respect to the critical
descriptive information is desirable.
Outcomes
Of those homeowners who participate, what outcomes are achieved? Of those homeowners
who achieve an agreement, or meeting of the minds, what is the result? The consensus
among Workshop participants, supported by anecdotal reports of industry participants in
mediation programs, was that there is little standardization of outcomes across programs,
and even across different organizations or entities within a given program. It would be
advantageous to have consistent definitions of outcomes across the country so that
programs can be viewed individually and in the aggregate. Right now it is difficult, as
several participants noted, to get “apples-to-apples” comparisons of the many existing
programs.
11
For example, agreements should be categorized as either a non-liquidation agreement (e.g.,
loan modification, forbearance, partial claim/reinstatement) where the homeowner
remains in the home, or a liquidation agreement (deed in lieu of foreclosure, short sale,
etc.) where the homeowner exits the home. Data should also be collected when there is an
impasse, no agreement is reached, and the case proceeds to foreclosure.
Suggested sources of data/information: To achieve some level of uniformity, programs
should consider relying on (1) the U.S. Department of the Treasury’s Office of the
Comptroller of the Currency /Office of Thrift Supervision coding schema augmented with
codes for non-modification outcomes (e.g., temporary but not permanent stay of auction,
11
Geoff Walsh has written a number of pieces, summarized in his presentation at the Workshop, wherein he
makes this precise point. See, e.g.: Walsh, Geoffry, State And Local Foreclosure Mediation Programs: Can They
Save Homes?, Boston, MA: National Consumer Law Center 2009. Available at
http://www.nclc.org/images/pdf/foreclosure_mortgage/mediation/report-state-mediation-programs.pdf,
Walsh, Geoffry, Foreclosures: State and Local Foreclosure Mediation Programs: Updates and New Developments,
Boston, MA: National Consumer Law Center 2010. Available at
http://www.nclc.org/images/pdf/foreclosure_mortgage/mediation/report-state-mediation-programs-
update.pdf, and Walsh, Geoffry, Recent Developments in Foreclosure Mediation, Boston, MA: National
Consumer Law Center 2011. Available at
http://www.nclc.org/images/pdf/foreclosure_mortgage/mediation/rpt-mediation-2011.pdf.
12
Toward a Common Vocabulary of Evaluation
short-sale); (2) the Department of Treasury’s reporting requirements for HAMP
modification augmented for non-modification outcomes; and (3) the template for
Philadelphia’s modified court order (see Appendix: Philadelphia Residential Mortgage
Foreclosure Diversion Program Sample Court Order). Court records are one possible place
to capture information regarding the nature of the resolution (e.g., temporary v. permanent
modification, HAMP v. non-HAMP), as Philadelphia is now doing.
Sustainabilit y
Of those people who “save their home,” how sustainable is the arrangement? Do different
types of agreements (e.g., forbearance vs. modification) have different levels of
sustainability? In order to ascertain sustainability, resolutions need time to “age” and, once
aged, a variety of public records may yield relevant information. A reasonable time for
assessing post-resolution sustainability may be one year or more, because there is a time
lag between an event (e.g., a property sale or auction, recording of a mortgage, filing of a
lien) and its appearance in most public records databases.
Suggested sources of data/information: The data sources are several and likely vary from
jurisdiction to jurisdiction. With respect to the public records, questions of sustainability
are most directly addressed by the filing of a post-resolution foreclosure, sale, or other lien
(e.g., tax or utility), which may be found in property records from county recorder offices
or private data providers. Once the records are examined, the analysis is a reasonably
straightforward calculation involving the percentage of resolutions for which subsequent
foreclosures, sales, mortgages, or other liens have been filed. From these data, it is possible
to ascertain, or at least approximate, the number of resolutions for which the homeowner
is able to remain in her home.
Access
Examiners of foreclosure mediation programs should assess whether there is equitable
access to the program. In other words, is there evidence that outcomes are comparable
across racial, socio-economic, and other strata? Did different racial/ethnic groups or
income level populations access the program equally, and did they achieve similar results?
One basic – but inconclusive – approach is to prepare maps of participants and outcomes
where participants’ locations are overlaid on maps reflecting the racial/ethnic composition
of those areas. A more definitive approach asks the question: Given the unique
characteristics of the homeowner (or group of homeowners), did that homeowner (or
group of homeowners) achieve access and outcomes equal to another homeowner (or
group of homeowners) similar to them? This is a very complex set of questions, the
answers to which require a reasonably sophisticated set of statistical procedures, including
statistical controls for variables relevant to access/outcome (e.g., extent to which a loan
exceeds the value of the property, degree of delinquency, level of income). Nevertheless,
13
Foreclosure Mediation: Emerging Research and Evaluation Practices
the data sources necessary for these analyses are similar to data sources required for other
metrics, including those for outcomes and foreclosure rates.
Administrative Impact
There are several basic questions to measure a foreclosure mediation program’s impact on
the relevant agency or court and other stakeholders. How many times do cases come in
contact with a court or mediator? Over what time period does that set of contacts occur? Is
progress being made at each contact? How does the average time period of each case in the
program compare to the amount of time foreclosures proceed without the intervention?
One of the commonly heard criticisms of foreclosure mediation programs is that they
significantly slow down the foreclosure process. Workshop participants agreed that
mediation timelines are, and should be, of significant concern to all stakeholders. Notably,
many were not convinced that a common conception that mediation causes delay was
accurate. Participants agreed that data to assess how efficiently cases are processed
through the system is critical.
Sources of data/information: Court records (in judicial foreclosure jurisdictions) and
mediator or homeowner counselor/representative records. In either case, the most basic
elements are (1) case identification number, (2) plaintiff/defendant identification, (3) date
and time of meeting, (4) parties present at meeting, and (5) result of the session.
Impact of Housing Counselors
In November 2009, the Urban Institute issued a report that measured the impact of
housing counselors funded through the National Foreclosure Mitigation Counseling
Program, administered by NeighborWorks.
12
The report was co-authored by Workshop
participants Neil Mayer, Peter Tatian, and Kenneth Temkin. Although the report did not
seek to measure the impact of housing counselors with respect to homeowners in
foreclosure mediation programs specifically, the report is nevertheless instructive
regarding the impact that counseling has on homeowners’ ability to avoid foreclosure by
securing loan modifications. The report and the program it evaluated are described in
more detail below, under the section summarizing the afternoon panel. In brief, the report
concluded that counseling impacts foreclosure mitigation in three primary ways:
Homeowners who received NFMC counseling (1) are more likely to get a curing loan
modification, (2) are more likely to receive a larger payment reduction under the
modification, and (3) are more likely to be able to sustain the modification.
12
Mayer, Neil, Peter A. Tatian, Kenneth Temkin and Charles A. Calhoun, National Foreclosure Mitigation
Counseling Program Evaluation: Preliminary Analysis of Program Effects, Washington, D.C.: The Urban Institute
2009. Available at
http://www.urban.org/uploadedpdf/411982_NFMC_program_evaluation.pdf.
14
Toward a Common Vocabulary of Evaluation
There was a strong consensus among Workshop participants that the availability of
housing counselors is one of the most important factors, if not the most important, in the
ability of homeowners to navigate mediation programs and achieve optimal results. The
Urban Institute report constitutes strong evidence that housing counseling should be a
focal point in the design and implementation of mediation programs, although further
evaluation of the impact of counseling within the context of mediation is needed to
demonstrate that housing counselors are critical to the success of a mediation program.
Impact of Legal Assistance
Lawyers can play an important role in foreclosure mediation. Equipped with information
about relevant federal and state foreclosure relief programs, they can advocate on behalf of
their clients for sustainable loss mitigation packages or “graceful” exits, and are also able to
look out for settlement terms that may ultimately be harmful for the homeowner. A
lawyer’s ability to review loan documents for violations of consumer protection and other
laws can better position the homeowner to negotiate meaningful loan modifications in
mediation. In some circumstances, a lawyer may advise her client to withdraw from
mediation and claim an affirmative defense to foreclosure through the courts.
Several mediation programs have established relationships with legal aid providers and
pro bono attorneys. For example, the Circuit Court of Cook County’s Mortgage Foreclosure
Mediation Program provides homeowners who are seeking mediation with a free
consultation with a pro bono attorney. The attorney reviews the loan paperwork to make
an initial determination whether the homeowner has a legal defense to foreclosure that
should be pursued through the courts. Where appropriate, the attorney will help the
homeowner prepare a request to the court for appointment of pro bono counsel. If there is
no defense to the foreclosure, and the case proceeds to mediation, the homeowner will
have the assistance of a pro bono attorney throughout the mediation process. Other
jurisdictions, including New York and Philadelphia, have made or are attempting to make
attorneys available to eligible homeowners, free of charge, in foreclosure mediation.
13
13
Notably, the New York Court System recently unveiled a plan to provide every homeowner facing
foreclosure with an attorney. See Streitfeld, David, “New York Courts Vow Legal Aid in Housing,” N.Y. Times,
Feb. 15, 2011 (“It’s such an uneven playing field,” said the state’s chief judge, Jonathan Lippman. A lawyer for
every defendant will also serve the courts’ interests, the judge said, by making proceedings more efficient.)
As of yet, however, New York has not allocated funds for this effort and a pilot program in two counties is still
in development. New York’s response to the foreclosure crisis, a $25 million dollar Foreclosure Prevention
Services Program that funded legal services, housing counseling, outreach and education to homeowners at
risk of foreclosure, and helped to coordinate services and pro bono panels for the mediation process, ends
December 31, 2011, and has not been renewed despite an ongoing need for services. See Rodriguez, Marisol,
“As the Bronx Leads in Foreclosures, Budget Cuts Loom for Critical Legal Services,” Bronx Free Press, Sep. 21,
2011.
15
Foreclosure Mediation: Emerging Research and Evaluation Practices
Although Workshop participants agreed that, anecdotally, the presence of a lawyer seems
to result in more sustainable loan modifications for homeowners, there is a dearth of
quantitative information about the impact of lawyers on foreclosure mitigation generally,
and their value in foreclosure mediation in particular.
14
While acknowledging some of the
challenges of measuring the impact of legal assistance (as lawyers may be involved only
with the more complicated cases), there was consensus that more research needs to be
done to assess the costs and benefits.
* * *
A chart identifying some preliminary data points for each key foreclosure mediation
program metrics described above appears on the following page.
14
For a discussion of the value of attorneys in foreclosure proceedings generally, see Melanca Clark & Maggie
Barron, Foreclosures: A Crisis in Legal Representation, New York, NY: Brennan Center for Justice 2009.
Available at
http://brennan.3cdn.net/a5bf8a685cd0885f72_s8m6bevkx.pdf.
16
Toward a Common Vocabulary of Evaluation
Metrics
Measures
Computations
Data Sources
Program
•
Eligibility requirements
Qualitative assessment
•
Applicable statutes and
Characteristics
•
Opt-in/Opt-out structure
rules
• Mandatory Participation
• Borrower questionnaire
•
Paperwork requirements
•
Interviews
•
Compliance structure
Foreclosure Rate
• Total number of foreclosures (owner
occupied, single family, etc.)
• Total number properties (owner
occupied, single family, etc.) in
jurisdiction
Foreclosure rate = total number of
foreclosures in jurisdiction/total number of
properties in jurisdiction
• City/county databases
Participation Rate
•
Total number of foreclosures
•
Foreclosures eligible for intervention
• Total program participants
Participation Rate 1= Number participating
in program/Foreclosures eligible for
intervention
Participation Rate 2 = Number participating
in program/ Total number foreclosures
•
Court administrative
databases
Outcomes
•
Total program participants
•
Total agreements reached
• Type of agreement
3. Lost Home (liquidation)
Deed in lieu
Short sale
Graceful exit
4. Retained Home (non-liquidation)
Loan modification
Forbearance plan
Partial claim -
reinstatement
Outcomes 1 = agreements reached/total
program participants
Outcomes 2 =liquidation agreements/ total
agreements reached
Outcome 3 = non-liquidation agreements/
total agreements reached
•
Court administrative
databases
• Counselor/mediator
records
• Observation and
interviews
Sustainability
•
Number of participants who retained
home
• Number of participants who remained
in home for defined period of time
after case closed
Sustainability = resolutions for which
subsequent foreclosures, sales, mortgages,
or other liens have been filed/ total number
of resolutions (using at least one year time
period from date of initial resolution)
•
City/county databases
•
Court administrative
databases
• Counselor/mediator
records
•
Observation and
interviews
Administrative
•
Number of times each case “touches”
Administrative Impact 1 = median days
•
City/county databases
Impact
program
• Number of days cases take until
resolution (i.e., agreement or reentry
into foreclosure process)
• Number of days cases take until
resolution without mediation
cases take until resolution (agreement or
reentry into foreclosure process)
Administrative impact 2 = median number
times each case “touches” program
Administrative impact 3 = median days
foreclosure process without mediation
intervention
•
Court administrative
databases
• Federal data
Administrative impact 4 = administrative
impact 1 /administrative impact 3
Access
• Total program participants
•
Participants’ race/ethnicity
• Participants’ income
• Loan to value ratio
•
Delinquency
Computations require a reasonably
sophisticated set of statistical procedures
including statistical controls for variables
relevant to access/outcome (e.g., extent to
which a loan exceeds the value of the
property, degree of delinquency, level of
income).
• City/county databases
•
Court administrative
databases
• Federal data
Representation/
•
Total program participants
Counseling rate = Participants assisted by
•
Court administrative
Counseling
•
Participants assisted by counselors
counselors/total program participants
databases
• Participants assisted by lawyers
Representation rate = Participants assisted
• Court administrative
databases
by lawyers/ total program participants
•
Counselor/mediator
records
Foreclosure Mediation: Emerging Research and Evaluation Practices
B. Data Sources – Resources & Challenges
17
As the chart on the previous page makes clear, several data sources may be useful to track
and analyze what foreclosure mediation programs accomplish. Existing databases and data
collection processes are useful, but generally need adaptation. Moreover, experience and
anecdotal reports suggest that no single database will be sufficient; multiple databases
from a variety of sources will be necessary. In general, to perform any basic analysis, it is
likely that data will need to be collected from: (1) court administrative databases; (2)
city/county databases reflective of property ownership and characteristics; (3) counselor
and mediator records; and (4) observation and interviews. Secondary federal data sources
of general availability (e.g., Census/American Community Survey, Home Mortgage
Disclosure Act, to name a few) may also have some limited utility as a means of quantifying
the context within which the program operates.
15
As discussed below, there may be
confidentiality issues that arise in accessing and assembling data, depending upon the
source.
Court Administrative Databases
In judicial foreclosure states, the court’s administrative database is the first place to obtain
data reflecting homeowner participation, but the data is often limited. Mediation programs
in Philadelphia and other jurisdictions within which mediation programs operate suggest
four areas where courts could facilitate more robust evaluations: (1) add fields in court
orders reflecting the substance of the court contact; (2) add fields of data in court orders
that reflect the substance of any conclusion to the case; (3) add fields in court orders noting
the presence of homeowner and lender/servicer representation (even if in a limited
capacity); and (4) allow better access to the data. Traditionally, civil courts have not
collected much information on the substance of case resolution, noting only the “fact” of the
case’s conclusion rather than the “substance” of that conclusion.
16
Recording these data is
essential to understanding the impacts and outcomes of the foreclosure mediation
intervention.
City/County Databases
Many cities and counties have recorder or land management offices that contain current
and past real property records, which should include information regarding, inter alia,
ownership, title, liens, and sales. Cities and counties generally also have tax assessor offices
15
Use of proprietary secondary data sources (e.g., RealtyTrac for foreclosure filings) should be done with
great caution because they are of uneven reliability across the country. That may be an especially daunting
problem where a mediation program crosses jurisdictions (e.g., counties) and the proprietary data source
does not have equally good data relationships across those counties.
16
In contrast, many jurisdictions include the substance of court proceedings in criminal court orders (e.g.,
details of plea agreement or sentence).
18
Toward a Common Vocabulary of Evaluation
where additional information regarding property records may be found. These databases
potentially offer a wealth of information regarding the history of a particular address. One
significant problem is that the databases in many city and county offices that track this
information are antiquated, and thus do not allow for ease of access to information. Local
jurisdictions are gradually upgrading their technological infrastructure to permit greater
access. In the meantime, increasing numbers of private companies are offering automated
access to real property databases.
Counselor and Mediator Records
Counselors, mediators, and attorneys who participate in foreclosure mediation programs
generally have the ability to describe the homeowner’s circumstances, the nature and level
of service provided, and the results of those efforts. Some jurisdictions, such as Nevada,
have standardized summary forms that are completed at the conclusion of mediation. That
said, the experience of Workshop participants suggests that the data obtainable from these
sources has not yet been organized in a way that makes them a viable source of
information on the mediation programs. The stated reasons for these data deficits include,
but are not limited to, databases that contain free-form text not easily amenable to
tabulation or analysis, and a lack of consistency in recording information across (and
within) data sources. Confidentiality or privacy concerns may also preclude reporting
household level information. Counselors generally use one of two systems for reporting
data (CounselorMax or Home Counselor OnLine) and thus standardization of data
collection/reporting is possible. Participants at the Workshop underscored the importance
of relevant agencies conferring to establish some general rules for case identification and
data reporting. (For a discussion of “Confidentiality Concerns,” see below.)
Observation and Interviews
A less precise but nevertheless valuable data source involves the observation of mediation
programs and interviews with participants. One good example of this work is described in
greater detail below – South Brooklyn Legal Services worked with the Center for NYC
Neighborhoods to create a survey instrument that law students and volunteer attorneys
could utilize while observing mediation proceedings. The survey included quantifiable
data such as appearances and outcomes, and was also designed to incorporate a post-
settlement conference interview with homeowners regarding their understanding of the
process. Over 800 mediation conferences were observed and recorded, yielding valuable
insights not only into the outcomes of the proceedings but also into the factors underlying
certain outcomes, and resulting in an influential report entitled “Locked Out.” (See below
for additional information.) Observations and interviews thus are particularly valuable
complements to “hard” data that may demonstrate the “what” but not the “why” or “how.”
Foreclosure Mediation: Emerging Research and Evaluation Practices
19
Federal Data
Federal data can generally be used to establish a context and to act as a comparator for the
results obtained in local or statewide mediation programs. Unfortunately, Workshop
participants have found that federal data collected on the Home Affordable Modification
Program (HAMP) and other related foreclosure intervention efforts have been of limited
utility in this endeavor. Data collected by the Treasury Department on the Making Home
Affordable (MHA) program lacks specificity (e.g., servicer identification and other critical
data items are suppressed) and there is a high level of geographic aggregation, and thus the
data generally cannot serve as a reasonable comparator for the area within which the
mediation program is operating. Moreover, the Treasury Department reports that it does
not verify the MHA data
17
(as compared to the validation that the Federal Financial
Institutions Examination Council's and financial regulators undertake with Home Mortgage
Disclosure Act (HMDA) reporters), so the MHA database contains the reports of loan
servicers that are not validated and may be incomplete. One Workshop participant noted
that it may take the efforts of regulators and private attorneys general to ensure lender
report accuracy. More useful for the purposes of benchmarking mediation programs would
be MHA micro data akin to the HMDA data collection effort, wherein personal identifying
information is suppressed but geographic identifiers and loan and loan modification items
are reported (e.g., Census tract).
Confidentiality Concerns
One emerging challenge to collecting and analyzing foreclosure mediation data is the issue
of confidentiality. Privacy concerns have recently garnered some attention in the media as
at least one foreclosure mediation program has cited its confidentiality policy as a bar to
disclosing data on program outcomes.
18
Several programs have also reported some
reluctance on the part of lenders to disclose the terms of mediation agreements. For those
jurisdictions that have adopted a variant of the Uniform Mediation Act, there may be a
further wrinkle, as the act allows every party to mediation to refuse to disclose, and to
prevent any other party from disclosing, a mediation communication, although the
privilege does not cover signed agreements.
19
Wherever possible, programs should create
clear guidelines that serve to maintain participant confidentiality, but also permit
reasonable disclosures of aggregate data to facilitate program evaluation. Given attorney-
17
Making Home Affordable Data File User Guide Version 2.0, 4, Nov., 2011, available at
http://www.treasury.gov/initiatives/financial-
stability/results/Documents/MHA%20Data%20File%20User%20Guide%2011-4-2011.pdf.
18
Hildago, Jason, “Nevada's Foreclosure Mediation Program Cites Confidentiality in Refusal to Release
Records,” Reno-Gazette Journal, July 19, 2011. Available at
http://www.rgj.com/article/20110719/BIZ02/107170357/Nevada-s-foreclosure-mediation-program-cites-
confidentiality-refusal-release-records.
19
National Conference of Commissioners on Uniform State Laws, Uniform Mediation Act, Sec. 5.
20
Toward a Common Vocabulary of Evaluation
client privilege, confidentially issues also arise when attorneys are involved in the
mediation process. “Firewalls” between housing counselors and attorneys can create
critical information gaps. Limited privacy waivers may be needed to ensure that
information can be shared across sources for purposes of program monitoring.
SUMMARY OF WORKSHOP PROCEEDINGS
Panel One - Framing the Issue: Foreclosure Mediation Program Stakeholders Discuss
Program Objectives and Research and Evaluation Needs.
Panelists on the morning panel were Geoff Walsh, Attorney, National Consumer Law
Center; Roberta Palmer, Program Manager, Connecticut Judicial Branch Foreclosure
Mediation Program; and Jennifer Sinton, Deputy Director, South Brooklyn Legal Services
Foreclosure Prevention. The panel focused on foreclosure mediation program models,
emerging trends, and program objectives, and discussed the need for research and
evaluation of program impact as well as the work that has been done to address those
needs. The discussion also focused on the various partnerships that mediation programs
have created to conduct research and evaluation, views of the stakeholders regarding the
benefits and drawbacks of various partnership models, and suggestions for ways in which
the federal government can support research and evaluation efforts.
Geoff Walsh, Attorney, National Consumer Law Center
Mr. Walsh noted that, in several jurisdictions, mediation programs have been an outgrowth
of existing alternative dispute resolution programs, while in other jurisdictions like New
York, the mediation program has been established by legislation. In a few states, like
Florida, the Supreme Court has established or provided a set of recommended guidelines
for a statewide model,
20
whereas in other jurisdictions, like Philadelphia, the local court
has adopted a set of procedures at the county level.
There has been an expansion of programs in non-judicial foreclosure states. Nevada was
first, and Maryland and Washington have followed. The City of Providence also has a
mediation program.
Generally speaking, given the divergence of bargaining power between the lender and an
often unrepresented borrower, the best programs have been those where there is a third
party facilitator with knowledge of the court and program rules who makes an effort to
20
Immediately before this report was published, the Florida Supreme Court ended the statewide mediation program.
See Jeff Ostrowski, Admitting Failure, Florida Supreme Court Ends Foreclosure Mediation Program, Palm Beach
Post, Dec. 19, 2011, http://www.palmbeachpost.com/money/foreclosures/admitting-failure-florida-supreme-court-
ends-foreclosure-mediation-2041550.html.
Foreclosure Mediation: Emerging Research and Evaluation Practices
ensure those rules are enforced. Programs that simply require the lender to communicate
with the borrower prior to entering foreclosure have been less successful.
21
Program models are quite varied across the county. One feature that seems to have a
significant impact on participation rates, from 10 percent on the low end to 80 percent on
the high end, is whether eligible borrowers are automatically enrolled in the program
versus having to elect to participate. Another variation is legal representation. In New
York’s program, 30-40 percent of homeowner participants have legal representation,
where in many other states only 5-10 percent of homeowners have legal representation.
Mr. Walsh suggested that such factors have an impact on ultimate outcomes of the
program.
Another variation involves program requirements. In jurisdictions like Vermont, Maine,
and Nevada, mediation program administrators require servicers to demonstrate their loss
mitigation analysis either under the HAMP requirements, or the FDIC loan "mod in a box"
analysis, and the servicers are not allowed to foreclose until they demonstrate compliance
with the applicable requirements. There have not been significant legal challenges to states
requiring this type of accountability. Moreover, programs are increasingly requiring good
faith participation by homeowners and borrowers.
Mr. Walsh noted recent research on re-default rates for loan modifications. At this point,
the re-default rates for HAMP are low, about 10 to 15 percent, down from 50 percent in
2008. The HAMP modification amounts tend to be twice as high as proprietary loan
modifications, and re-default rates half as high. Of course, there is a lot of variation from
state to state.
Mr. Walsh concluded by noting that fewer programs are actually having technical
mediations. Programs working well have court staff overseeing ongoing communication
between homeowners and servicers. Particularly where there are consequences for non-
compliance, very few actual mediations are required.
Roberta Palmer, Program Manager, Connecticut Judicial Branch Foreclosure
Mediation Program
Ms. Palmer shared her experiences as chief administrator of Connecticut's foreclosure
mediation program. She explained that Connecticut is the first statewide court based
mediation program in the country. The program was established through legislation in July
2008, and Connecticut enjoys the luxury of a unified court system with initial funding
provided through a banking fund.
The program was created from the ground up exclusively for foreclosure cases, and had the
explicit goal of, wherever possible, keeping homeowners in their homes. All of the program
22
Summary of Workshop Proceedings
managers have mediation background in landlord-tenant cases, and so understand that
many litigants are self-represented. Program staff are trained specifically to deal with this
population, as 60 to 75 percent of all homeowners are self-represented and have trouble
communicating with the servicers, which tend to be large national entities. Mediators are
mostly attorneys who have extensive training, including on HAMP program requirements.
In its three years of operation, the Connecticut mediation program has learned many
lessons. The program began in June 2008 as a voluntary program where homeowners had
to opt in, but the structure was changed to an opt-out program in July 2009. Remarkably,
the program participation rate rose from 33 percent to over 80 percent without a
proportional decrease in successful outcomes for program participants. The other change
to the program structure was the retention of cases involving temporary modifications
until the modification is made permanent. While this entails keeping cases in mediation for
many months, it can help ensure that a homeowner receives a final resolution. No case can
go to court until a mediation report is filed.
The program also has incorporated an accountability mechanism which requires that all
HAMP denials be explained to the mediation program administrator. Also, while mediation
program administrators cannot make a determination whether a party is proceeding in
good faith, they can refer the matter to a judge who will make the determination, and there
have been instances in which a judge has entered sanctions for lack of good faith.
At this point, explained Ms. Palmer, Connecticut is trying to do more with less, as the
funding picture has become considerably uncertain in the current economic climate. It is
unclear what future funding will look like and, given the austere budget environment, it is
more important than ever that the Connecticut program prove its worth. Ms. Palmer has
been compiling monthly settlement rate statistics and posting them on the program
website to demonstrate the impact of the program, as they have learned that anecdotal
information is not enough. More robust data is needed.
Jennifer Sinton, Deputy Director, South Brooklyn Legal Services Foreclosure
Prevention Project
Ms. Sinton described the foreclosure project at South Brooklyn Legal Services, which brings
fair housing, foreclosure defense, and non-litigation advocacy for homeowners. For the last
few years, SBLS has been very involved in settlement process in New York. On any given
day in NYC courts, SBLS attorneys are representing borrowers in these proceedings.
The New York foreclosure settlement conference was established through legislation in
September 2008 for 1-4 family, owner-occupied homes in which the borrower held a
subprime or non-traditional loan. (The legislation was later amended to expand access to
23
Foreclosure Mediation: Emerging Research and Evaluation Practices
the program for all 1-4 family, owner-occupied homes.) Conference rules require that
parties must appear with authority to settle, or otherwise be available by telephone.
In New York, in contrast to Connecticut, the program was not funded. The county courts
were burdened with a new mandate, but no new funding to do it. One result was minimal
training. While advocates later came together to provide training, it was not front loaded.
Within a few months of its establishment, it was apparent that the foreclosure settlement
conference was not fully functional. In certain counties, it was clear that judges were not
familiar with foreclosure mitigation program or eligibility requirements or the foreclosure
process generally. In addition, in Ms. Sinton’s view, servicers were not responsive, and
borrowers were being blamed for the delays.
SBLS felt there was an urgent need to improve the process, and worked together with other
advocates to monitor what was happening in the settlement conferences. SBLS, working
with the Center for NYC Neighborhoods (CNYCN), and in collaboration with the
Neighborhood Economic Development Advocacy Project and other legal service providers,
created a simple, low cost survey instrument that could be rolled out quickly. The biggest
expense of the project was comprised of the human resources necessary to put it together
and do monitoring in court.
After the survey was developed, law students and volunteer attorneys used the survey to
perform observations in New York City’s foreclosure settlement conferences. The group
alerted courts to the observations and asked their permission, even when it might not have
been required, as they felt it was important to get the courts’ buy-in.
Questions on the survey included:
• Who was present (e.g., homeowner lawyer, counselor, servicer representative, etc.)?
• Was plaintiff represented by counsel from the firm or a “per diem” lawyer hired for
the day?
• Identification and index number of parties/property of address.
• Who spoke first, and did the homeowner speak at all?
• Did the court recall what happened at the prior conference?
• Did the court assess affordability?
• Was the HAMP program explained?
• Was the homeowner prepared?
• Did the court engage in moving the settlement conference forward?
• What was the outcome of the proceeding?
Notably, the survey did not just look at results, but also at the process. Survey takers did a
post-settlement conference interview with homeowners about their understanding of
settlement conferences and process. At the end of the project, over 800 conferences were
24
Summary of Workshop Proceedings
observed over a two-month period in the summer of 2009. In October 2009, CNYCN
published a report on the findings entitled “Locked Out” and highlighted the fact that
lenders were not coming to court prepared, lender attorneys were often not familiar with
the case, and it was hard to get a knowledgeable person from the lender on the telephone.
21
The report also revealed that judges were not particularly effective in moving cases
forward, and that existing program rules were not being enforced.
“Locked Out” led to changes in the settlement conference authorizing legislation, including
the addition of an express good faith requirement, more clear documentation requirements
for lenders, and clarification that the foreclosure process is stayed pending the resolution
of the conference procedure. The legislation also specified that the Office of Court
Administration should collect data to evaluate the conference proceedings.
Overall, the new legislation made the courts and the process more accountable. In addition,
SBLS and other advocates are working with the Office of Court Administration and the
county courts to further improve the process. That said, the process is still slow – it is not
uncommon for SBLS to work on a case for one or two years. Ms. Sinton believes that
servicers can still be unresponsive, and SBLS has been filing motions for tolling of interest
or dismissal of foreclosure in response to servicer misconduct, undue delay, and bad faith.
In short, there is still a long way to go, and the resources of the court and advocates have
been drained. Finally, as is generally the case, the lack of sufficient resources has frustrated
efforts to provide the necessary assistance to the parties and courts, and thus has hurt
program efficiency.
Discussion
Several themes emerged in the conversation following the first panel. Selected highlights
are below:
• Timeliness and efficiency are critical. One observer noted it typically takes six
mediation sessions to reach resolution in Connecticut, when really it should just
take two. An extended process is not helpful to either side. It also narrows options
as it is very difficult to deal with a 16 month arrearage if the case has stuck around
that long. Concerns about time do, however, need to be based on data. In Florida,
for example, common wisdom was that mediation added significant delay to the
foreclosure process. Florida has a 120 day mediation process. However, the Collins
Center for Public Policy, which administers the state’s foreclosure mediation
21
Masters, Amanda, Michael Hickey, Tracie McMillan and Amanda Insinga, Locked Out: Little Relief for NYC
Homeowners in the Foreclosure Settlement Process, New York, NY: The Center for New York City
Neighborhoods 2009. Available at
http://www.nclc.org/images/pdf/foreclosure_mortgage/foreclosure_med_prog_by_state/ny_locked_out_rep
ort.pdf.
25
Foreclosure Mediation: Emerging Research and Evaluation Practices
program, found that, a year out from the mediation process, plaintiffs’ counsel had
not requested summary judgment in 75 percent of cases referred back to court for
foreclosure. Accordingly, it appears that the mediation program itself is not to blame
for the long delays that precede foreclosure sales.
• One participant also noted that, in comparing programs by the average number of
mediation sessions, it is important to ensure an “apple to apple” comparison.
Although most programs will continue a mediation session if the lender is
unprepared (notably, few programs allow for subsequent mediation when the
homeowner is unprepared), some programs, like Connecticut’s, will count the
session even where one party is unprepared, while others will describe such an
occurrence as a “non-appearance” and will not count the session. The Maryland
program allows 60 days to resolve the case through mediation. If there is no
resolution, the case goes back to court and sale can be scheduled. There are no
sanctions for non-participation or lack of good faith.
• In Cook County, Illinois, there is a funnel process for participation that proceeds
through multiple steps. The first step is outreach, including door knockers. All
borrowers must go through the housing counseling process, and there is also a
review to determine whether there are any legal defenses.
• The best indication as to whether mediation is taking too much time is the
comparison between the length of the mediation process and the overall average
length of the foreclosure process. In Cook County, for example, foreclosures take
between a year and a year and a half to proceed, so an intervening process that
takes several months should not be said to have caused significant delay.
• The HAMP program is moving toward transparency, and mediation programs
should follow suit for their calculation of both HAMP modifications and proprietary
modifications.
• The success of mediation programs comes down to accountability. Mediators find it
extremely difficult to move things forward when a servicer is non-compliant. The
escalation process is not working because there is no real threat of federal
intervention.
• In many areas, properties going through foreclosure end up vacant and abandoned.
Banks end up selling homes in foreclosure at a much lower cost than they are able to
do in a loan modification context. It would be good to have right of first refusal for
homeowners at these auction sales. There is a real need to think of occupancy of
these properties as a social good, because foreclosures have a negative spill-over
effect with additional costs. For that reason, policy makers should discuss
26
Summary of Workshop Proceedings
foreclosure mediation within the framework of understanding it as a tool that helps
stabilize neighborhoods.
• It is an issue of cost savings. There is a presumption that mediation costs public
monies, and that alternatives do not. That is a misunderstanding. Public costs (e.g.,
sheriff costs, court courts, loss of tax revenue, blight, etc.) must be included in
tallying the cost of foreclosure.
• Participants agreed that it is important to subject foreclosure mediation programs
to a cost/benefit analysis. The Center for American Progress did an analysis of the
savings that could accrue from modifications, using a conservative estimate of a 25
percent reduction rate, based on a median home price of $150,000.
22
The study
showed savings of $37,000 for every house not foreclosed on, which does not
include savings in external costs.
• One participant noted that the question of whether mediation programs are
working is not the same as whether the programs are “worth it.” Programs may
make economic sense at a very low threshold if loan modifications on average save
$37,000 as compared to going through with a foreclosure.
• Opt-out programs are reaching more people. While opt-in programs generally see
25 percent participation, opt-out programs can see that number for non-
participation.
• Outreach is crucial. The use of door knockers in Philadelphia has been tremendously
successful. New York also is doing aggressive individualized outreach through the
courts.
Panel Two - Researchers Discuss Challenges and Lessons Learned from Evaluation of
Foreclosure Mediation Programs and Related Foreclosure Prevention Interventions.
Panelists on the afternoon panel were Ira Goldstein, Director of Policy and Information
Services at The Reinvestment Fund (and the Workshop’s facilitator); Kathryn Wertheim
Hexter, Director of the Center for Community Planning and Development at Cleveland State
University; and Peter Tatian, Senior Research Associate at the Urban Institute. Mr. Tatian
was joined in his presentation by Neil Mayer and Ken Temkin, who teamed with Mr. Tatian
to conduct research regarding the effect that housing counselors have had in homeowners’
ability to avoid foreclosure. The subsequent roundtable discussion was intended to
explore research methodologies, data sources and data collection techniques, related
challenges, and lessons learned from research. The discussion also focused on
22
Cohen, Alon, Foreclosure Mediation Going Forward: States Need to Expand Their Programs if the Federal
Government Steps Back, Washington, D.C.: Center for American Progress 2011. Available at
http://www.americanprogress.org/issues/2011/04/foreclosure_mediation.html.
27
Foreclosure Mediation: Emerging Research and Evaluation Practices
prioritization of types of data collection and evaluation in view of resource limitations, and
the relative benefits and drawbacks of the various methodological models.
Ira Goldstein, Director, Policy & Information Services, The Reinvestment Fund
Mr. Goldstein began the panel by describing his efforts to evaluate the mortgage
foreclosure diversion program in Philadelphia.
23
Mr. Goldstein stated at the outset that his
research is informed by the maxim that “the perfect is the enemy of the good.” He sought to
answer some basic questions about the Philadelphia program through his research: (1)
What is this size of the foreclosure problem, and what portion of the problem can the
program address? (2) What are sets of outcomes that may derive from the program? (3) Is
there an effect on case processing and efficiency in the court system? (4) How sustainable
are outcomes? (5) Does the program increase access to the justice system, in that it
reaches homeowners regardless of their race, socio-economic status, etc.?
Mr. Goldstein gave a brief description of the diversion program, from the initial outreach to
distressed homeowners to the referral to the hotline run by a legal services organization
that matches homeowners with housing counseling agencies (and, in rare situations, to
legal aid providers). Some homeowners bypass the counseling services and go through
system on their own (with or without lawyer).
The evaluation relies upon a variety of data sources, but primarily uses the foreclosure
filing itself, tax records, court orders and the on-line court filing system, property
information obtained from the RealQuest database, two on-line databases into which
counselors enter homeowner information, and, finally, interviews with homeowners at the
close of their case. Mr. Goldstein also obtains secondary data sources like Census figures in
order to establish measuring sticks against which to measure outcomes.
With respect to the questions that Mr. Goldstein set out to answer, the data are promising.
The program reaches 80-85 percent of residential foreclosure cases (it is limited to
homeowner-occupied homes). Although measuring objective “success” is difficult, the last
court orders in the impacted cases demonstrate that for eligible homeowners automatically
entered into the diversion program, an agreement between the plaintiff and the defendant
is reached in 35 percent of cases. Further, 85 percent of the cases are resolved in two
appearances or less. In addition, the outcomes have, for the most part, been sustainable –
for homeowners who reached agreements before June 2009, an “overwhelming majority”
of them are still in their homes. Finally, the outcomes (including agreements, failures to
appear, and subsequent sales) are similar across neighborhoods with varying housing
23
On June 14, 2011, Mr. Goldstein released the report documenting his research. That report is in the
Resource List, and is briefly described in the Background section of this report.
28
Summary of Workshop Proceedings
prices and racial and ethnic make-ups, meaning that the results appear to be relatively
unaffected by the homeowners’ race and socio-economic status.
Mr. Goldstein then described the challenges of his evaluation efforts. First, it has been
difficult to study the substance of the agreements, in part because the data is in paper form
and difficult to compile. The court has made some modifications to its court orders to make
data compilation easier, but it is still labor intensive. Mr. Goldstein has also been unable to
measure the impact of counseling or legal representation; with respect to the latter,
because only 5 percent of cases have formal court appearances, the sample group is
relatively small.
Kathryn Hexter, Director, Center for Community Planning and Development,
Cleveland State University
Ms. Hexter discussed her evaluation efforts in Cuyahoga County, Ohio. She is evaluating
mediation as part of her study of the overall foreclosure prevention program, which is
generally a counseling-based program. Cuyahoga County adopted its foreclosure
mediation program in May 2008, and in April 2010 it started a pilot program that placed
housing counselors in the courtroom for mediation sessions.
For the past several years, Cuyahoga County has had 13,000 to 14,000 foreclosure filings
each year, and in 2008 suburban filings started to outpace filings in Cleveland. Mediation is
an opt-in program, and approximately 30 percent of homeowners facing foreclosure enter
the program. Once mediation is ordered, participation is mandatory, so if a plaintiff does
not send somebody with settlement authority to a mediation session, the case is dismissed
without prejudice. (The servicer may be represented by an attorney at pre-mediation, but
the servicer must be present at mediation.)
Ms. Hexter stated that her data sources are not as good as Mr. Goldstein’s in Philadelphia,
because she is relying upon the data that the county court gives to the state. About 85
percent of people who request and attend a pre-mediation session get referred to formal
mediation (with about 15 percent being found “unsuitable”). The program originally
allowed investor-owned properties, but it no longer does. About 61 percent of cases that
go to mediation are settled, although she is unable to get behind the agreements so she
does not know what “settled” means, other than that the plaintiff and the defendant agreed
on some outcome. The cases that go to mediation last an average of 124 days in the
program.
Ms. Hexter has seen some themes developing. More people are opting in as the mediation
program develops, and program administrator estimates that about 25 percent who enter
mediation are in re-default status from pre-HAMP modifications. More cases are also
resulting in pay-offs – approximately 2 percent of the mediation cases resulted in pay-offs
29
Foreclosure Mediation: Emerging Research and Evaluation Practices
during the first year, but 10 percent did in the last year. Mediation is also beginning to
produce some principal reductions, although she is not seeing many HAMP modifications.
Ms. Hexter also is seeing more mediators strongly encouraging homeowners to seek
counseling help because it improves the process. In addition, Ohio recently received
Hardest Hit Fund money, so some homeowners are hesitant to enter an agreement if they
think that there is a possibility that they will get relief from that program.
With respect to the counselors-on-site pilot program, from April to December 2010, only
257 clients saw the counselors. Approximately 18 percent of homeowners who attended
pre-mediation met with a counselor, and 40 percent of them scheduled a follow-up
meeting. Legal aid attorneys attended a small number of the pre-mediation sessions.
Ms. Hexter stated that her evaluation would be improved by learning the substance of the
agreements, because knowing outcomes will help the program administrators know who
needs mediation the most and, for example, who can get the same benefit only with a
counselor. She also wants to compare mediation outcomes with outcomes for those who
receive counseling only (although most people going to counseling are in mediation). She
also would like to know who seeks mediation and who seeks counseling. (She suspects
that suburbanites are more likely to go straight to court, while people from lower socio-
economic strata are more apt to seek counseling first, a suspicion that is supported at least
partially by statistics from the counseling agencies regarding their clients.) She also would
like to study the impact of mediation on the court system to determine whether it increases
efficiency.
Peter Tatian, Senior Research Associate, The Urban Institute
Mr. Tatian concluded the prepared panel remarks; he was joined by Mr. Temkin and Mr.
Mayer. Their research focuses on whether the National Foreclosure Mitigation Counseling
(NFMC) Program is having an impact on homeowners. The short answer is, “Yes.”
NFMC is administered by NeighborWorks and has provided over $450 million to
counseling agencies in four rounds of funding. More than 1 million homeowners have
received counseling under NFMC. The Urban Institute evaluated the first two rounds of
funding (in 2008 and 2009), and its analysis focused on three questions: (1) Does NFMC
help homeowners in foreclosure get out of the foreclosure process? (2) Does NFMC have
an impact on the kind of modification that homeowners receive? (3) What is the impact of
counseling on the sustainability of modifications?
The study looked at two primary sources of data: (1) production data collected by
counseling agencies and submitted to NeighborWorks (although there were limitations
because counselors had to report data quickly on results, and it was difficult to follow up
with clients); and (2) servicer data on mortgage characteristics and monthly performance
30
Summary of Workshop Proceedings
(approximately 60-70 percent of mortgages in the country are in the database), and they
used supplemental data from the Census, unemployment data from the Bureau of Labor
Statistics, housing price indices, etc. From these sources, the researchers established two
data samples for analysis: (1) the total sample of NFMC-counseled loans that they could
match to the servicer database, which amounted to about 180,000 loans; and (2) a
comparison group of loans from the database with similar characteristics to the NFMC-
counseled loans but that were not counseled (a total of about 150,000).
With respect to the first question (whether counseling assists homeowners receive
modifications), counseling has a significant positive impact on the ability of homeowners
facing foreclosure to receive a loan modification. Homeowners are 1.696 times more likely
to cure foreclosure with a loan modification when they receive NFMC counseling. The
study also measured the impact of various levels of counseling – for example, whether the
homeowner meets with a counselor in order to develop a plan to secure a modification but
does not seek assistance in implementing the plan, versus more involvement with the
counselor through the process of actually receiving the modification. The report concludes
that the odds of securing a modification increase as the involvement of the counselor
increases.
On question number two (the quality of the modification), counseling also has a positive
impact. On average, the monthly payment reduction was $267 greater with NFMC
counseling than without, which corresponds to approximately 12 percent of the total
monthly payment.
Finally, question three: What is the likelihood that homeowners can sustain their
modifications, and does counseling have an impact? The researchers measured the same
group of homeowners – those who received modifications in 2008 – to determine who
remained current in December 2009. In short, homeowners who received their
modifications with the assistance of counselors performed better under their modifications
than those who did not: 64 percent of counseled modifications remained current,
compared to 51 percent of uncounseled modifications. Thus, counseling has a positive
effect on performance, although there is still a substantial number of homeowners who
cannot sustain their modifications. Researchers believe that this results from counselors
being able to help homeowners budget and understand the terms of their new loans,
although they cannot be sure.
So, counseling does three things with respect to loans: homeowners who received NFMC
counseling (1) are more likely to get a curing loan modification, (2) receive a larger
payment reduction under the modification, and (3) are more likely to be able to sustain the
modification.
31
Foreclosure Mediation: Emerging Research and Evaluation Practices
In conclusion, Mr. Tatian underscored the importance of having (1) a reliable data source
to track loan performance over a period of time, and (2) a control group against which to
measure the success of whatever intervention is being measured (and the ability to
discount other variables in looking at the performance).
Discussion
The follow-up discussion focused on several themes related to the panelists’ presentations.
• Participants discussed the need to control for variables other than the intervention
whose impact is being studied. For example, do HAMP modifications perform better
than non-HAMP modifications? What about the impact of sub-prime loans on the
ability to sustain a subsequent modification? In at least one jurisdiction, it appears
that race, ethnicity, and size of the mortgage actually have little-to-no impact on the
ability of homeowners to secure and sustain modifications, particularly when
compared to the impact of counseling, but there may be other factors that have a
relatively greater impact.
• What about measuring the impact of counseling against the cost of the NFMC
program? Participants believed that the dollar-figure impact on homeowners
benefited by the program (in modifications achieved, reduced payments, etc.) far
outweighs the program costs. They pointed to studies showing that foreclosures
cost communities tens of thousands of dollars in diminished property values for
surrounding homes and decreased tax revenues, so the overall impact of
interventions that save homes should far exceed the total cost of the program.
However, there was agreement among panelists and participants that more
research is needed to demonstrate that the benefits of NFMC exceed the substantial
cost to taxpayers.
• There was a broad discussion regarding where counselors make the most
difference. Do counselors make the most impact in gathering documentation, in
knowing the disparate information that various servicers need, in securing a single
point of contact, or in some combination of all of these? Several participants
suggested that counselors make the modification process work, where homeowners
on their own may give up when confronted with a lack of cooperation or
responsiveness.
• Several workshop participants described the difficulty in getting information on the
substance of agreements reached in mediation. Philadelphia gets information from
court orders, which have recently been modified to include information regarding
32
Summary of Workshop Proceedings
the type of agreement (e.g., HAMP modification, short sale, etc.). But, it is difficult to
weigh the desire to get more information with the need for efficiency.
• Others raised the issue of the unauthorized practice of law and whether counselors
providing assistance in the context of mediation can raise problems in this regard.
There was consensus that one protection against this potential problem is the
availability of lawyers to address legal issues that are not appropriate or advisable
to be addressed in a mediation or conciliation context.
• In looking at a national picture, one participant noted the challenge of identifying
uniform measures. Are different programs counting the same thing? What is the
proper unit of analysis (e.g., house or homeowner, owner occupied, etc.)? Common
definitions are needed in order to achieve comparable analyses. Perhaps one
solution is a standard court form on which agreed-upon data points can be collected.
Summary of Keynote Remarks by Department of Housing and Urban Development
Assistant Secretary for Policy Development and Research, Raphael Bostic
Assistant Secretary Bostic welcomed Workshop participants, and began his remarks by
noting how delighted he was to have the Department of Justice working on these issues
alongside HUD, and how important it is to combine the collective expertise of federal
agencies with that of the public and private sectors.
The Assistant Secretary noted that the strong program and energy of the convening is a
testament to the importance of the topic of foreclosure mediation. There is a need to
broadly engage stakeholders to raise the profile of the issue to get to a workable policy
outcome.
Assistant Secretary Bostic placed foreclosure mitigation tools in context by describing the
arc of the housing crisis, which has caused over $6 trillion dollars in equity to be lost, and
has been particularly devastating for lower income minority communities. While the
housing crisis began with predatory lending, it continued on the wave of a bad economy.
The now multi-dimensional crisis impacts what a reasonable response to the crisis should
look like. From a macro perspective, the nation will be unable to get to a healthy housing
market and economy without addressing the foreclosure crisis.
Regardless of how the United States arrived at the crisis, the Assistant Secretary noted,
millions of homeowners are at threat of losing their homes. Foreclosure is a bad outcome
for all parties. It causes obvious disruption in the lives of homeowners, who often suffer the
shame and stigma of the loss of their home. For lenders, managing foreclosure properties is
33
Foreclosure Mediation: Emerging Research and Evaluation Practices
costly, and recovery rates are low. Foreclosure mediation is a pathway to preferable
alternatives. In some jurisdictions, more than half of homeowners participating in
mediation are able to keep their homes. Short sales and deeds in lieu of foreclosure are
also particularly important. Although they are relatively rare when homeowner and lender
negotiate on their own, they are often a preferred outcome for both parties.
Assistant Secretary Bostic queried the audience: “If mediation is such a good idea, why
haven’t more jurisdictions taken up the mantle?” Noting that only five jurisdictions have
mandatory mediation programs, Assistant Secretary Bostic posed several questions for the
group to consider: “What are barriers to implementation and program participation, and
is the conventional wisdom that mediation takes a long time and is costly supported by the
evidence?”
Assistant Secretary Bostic described the challenge for policy makers as being how best to
translate good ideas into “on the ground” reality. His hope was that the convening would
help distill “what we know,” and put that information into a clear focus and frame so as to
make clear what steps are needed at the state, local, and federal level. In short, the need is
for replicable, reliable processes that everyone can understand.
Assistant Secretary Bostic concluded his remarks by acknowledging that formulating an
appropriate framework for mediation is a challenging but important task, and one at which
we cannot afford to fail. The stakes are high. The Assistant Secretary remained hopeful that
the workshop would help set us on the path of articulating what next steps should be to
achieve better outcomes.
34
Recommendations for Federal Action
RECOMMENDATIONS FOR FEDERAL ACTION
Workshop participants felt strongly that a more robust evidence base supported by
research should prompt the federal government to take additional steps to support well-
structured foreclosure mediation programs. They had several recommendations for ways
in which the federal government could facilitate the development and proliferation of
foreclosure mediation programs based upon an evidence-based model.
24
Recommendations for action included:
• Supporting research and evaluation of state and local foreclosure mediation
programs through funding and technical assistance.
• Establishing federal guidelines for foreclosure mediation programs, and providing
technical assistance to assist state and local programs to meet them.
• Funding, perhaps on a matching basis, mediation programs that meet established
federal guidelines.
• Establishing a template that contains uniform data points for collection that
foreclosure programs can adopt.
• Requiring that federally-backed loans go through mediation before foreclosure can
take place.
• Improving escalation processes for federal loan modification programs, to allow
intervention in individual foreclosure mediation cases where necessary to achieve
an agreement.
• Encouraging banking regulators to allow states to implement mediation
interventions without the threat of intervention by the banking industry.
24
The Recommendations for Federal Action contained in this document are those of the non-federal
workshop participants and do not necessarily represent the views of the authors or the official position or
policies of the U.S. Government.
Foreclosure Mediation: Emerging Research and Evaluation Practices
35
CONCLUSION
The Workshop convening documented the available models, resources, and challenges
relating to the evaluation of foreclosure mediation programs, and also produced an
important list of recommendations for the federal government on how it can support
mediation. Each of these efforts highlighted what emerged as a strong consensus among
Workshop participants: Foreclosure mediation is an important intervention that, if well-
conceived and carefully implemented, can have overwhelmingly positive impacts on
homeowners, lenders and investors, and communities.
Several themes emerged from the Workshop:
• As foreclosure mediation programs proliferate and their structures become more
varied, research and evaluation are critical to determine which models and program
characteristics produce the best outcomes, and which are less successful.
• Although some research has been conducted, more rigorous and regular evaluation
of foreclosure mediation programs is needed.
• In order to conduct the kind of research and evaluation that is needed, there must
first be consensus regarding which data points and categories of data must be
collected, so that programs are measuring the same things and comparison is
possible.
• The research and evaluation will require resources, but some of the creative
collaborations represented in the Workshop, such as those between programs and
academic institutions, foundations, legal aid organizations, think tanks, and
government partners, can lead to efficient use of resources and quality evaluation.
• The federal government should take an active role, both in helping to develop
program and evaluation guidelines and in providing resources for mediation
programs and research.
Workshop participants acknowledged the many challenges that exist in developing quality
foreclosure mediation programs through rigorous evaluation, including the need to
convince the public and policymakers of the need for resources for mediation, but
participants stressed that the intervention is such a critical tool in the nation’s effort to
address the foreclosure crisis that the challenges must be met.
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Foreclosure Mediation: Emerging Research and Evaluation Practices
RESOURCE LIST
Center for New York City Neighborhoods (2009). Locked Out: Little Relief for
Homeowners in the Foreclosure Settlement Process.
http://cnycn.nonprofitsoapbox.com/storage/cnycn/documents/cnycn%20ny%20settleme
nt%20conference%20report%20final%20copy%2010%2009.pdf
Clifford, R. (2011). State Foreclosure Prevention Efforts in New England: Mediation
and Assistance. Federal Reserve Bank of Boston, New England Public Policy Center.
http://www.bos.frb.org/economic/neppc/researchreports/2011/neppcrr1103.pdf
Cohen, A. (2011). Talking it Up: How the Federal Government Can Implement
Automatic Foreclosure Mediation to Help Homeowners, Lenders, Investors and Tax
Payers. Center for American Progress.
http://www.americanprogress.org/issues/2011/01/pdf/foreclosure_mediation.pdf
Cohen, A. (2010). Walk the Talk. Center for American Progress.
http://www.americanprogress.org/issues/2010/11/pdf/walk_the_talk.pdf
Cohen, A. and A. Jakabovics (2010). Now We're Talking. Center for American Progress
http://www.americanprogress.org/issues/2010/06/pdf/foreclosure_mediation.pdf
Goldstein, Ira and Colin Weidig (2011). Philadelphia Residential Mortgage Foreclosure
Diversion Program: Initial Report of Findings. The Reinvestment Fund.
http://www.trfund.com/resource/downloads/policypubs/Foreclosure_Diversion_Initial_R
eport.pdf
Hexter, K.W. & M. Schnoke (2010). Responding to Foreclosures in Cuyahoga County,
Interim Evaluation Report January 1, 2009 Through December 31, 2009. Cleveland
State University, Maxine Levin college of Urban Affairs, The Center for Community Planning
and Development
http://urban.csuohio.edu/publications/center/center_for_community_planning_and_devel
opment/Responding_to_Foreclosures_in_Cuyahoga_County_2009.pdf
Additional reports of the Center for Community Planning and Development
available at:
http://urban.csuohio.edu/publications/center/center_for_community_planning_an
d_development/
38
Resource List
Mayer, N., P. Tatian, K. Temkin, and C. Calhoun (2010). National Foreclosure Mitigation
Counseling Program Evaluation: Preliminary Analysis of Program Effects, September
2010 Update. Urban Institute.
http://www.nw.org/network/nfmcp/documents/2010.12.14FINALModelingReport.pdf
Mayer, N., P. Tatian, K. Temkin, and C. Calhoun (2011). National Foreclosure Mitigation
Counseling Program Evaluation: Final Report Rounds 1 & 2. Urban Institute
http://www.nw.org/network/foreclosure/nfmcp/documents/NFMCEval_Rounds1-
2_Final.pdf
Pea, A. 2010. Report of the Chief Administrator of the Courts. State of New York
Unified Court System.
http://www.nycourts.gov/publications/pdfs/foreclosurereportnov2010.pdf
Richter F., L. Nelson and Y. Seo (2010). A Look Behind the Numbers Mortgage
Delinquencies in Ohio: Are Loan Modifications Stemming the Tide? Federal Reserve
Bank of Cleveland.
http://www.clevelandfed.org/Community_Development/publications/ALBTN/V3_1/index
.cfm
State of Nevada Foreclosure Mediation Program Mediation Statement and
Agreement.
http://www.nevadajudiciary.us/index.php/viewdocumentsandforms/func-
startdown/7745/
U.S. Dept. of Housing and Urban Development & U.S. Dept. of Justice (2010). Emerging
Strategies For Effective Mediation Programs.
http://www.justice.gov/atj/effective-mediation-prog-strategies.pdf
Walsh, G. (2011). Recent Developments in Foreclosure Mediation. National Consumer
Law Center.
http://www.nclc.org/images/pdf/foreclosure_mortgage/mediation/rpt-mediation-
2011.pdf
Walsh, G. (2009). State and Local Foreclosure Mediation Programs, Can They Save
Homes? National Consumer Law Center.
http://www.nclc.org/images/pdf/foreclosure_mortgage/mediation/report-state-
mediation-programs.pdf
39
Foreclosure Mediation: Emerging Research and Evaluation Practices
APPENDIX
A. Agenda
B. List of Participants
C. Panelist Biographies
D. Philadelphia Residential Mortgage Foreclosure Diversion Program Sample
Court Order
E. South Brooklyn Legal Services New York Settlement Conference Survey
Questionnaire
Foreclosure Mediation Programs
A Workshop to Discuss Emerging Research and Evaluation Practices
March 7, 2011
Sponsored by U.S. Department of Justice’s Access to Justice Initiative
AGENDA
Monday, March 7, 2011
9:45 – 10:00 Registration and Networking
10:00 – 10:15 Welcome and Workshop Goals and Outcomes
Deborah Leff, Deputy Counselor for Access to Justice, U.S. Department of
Justice
Melanca Clark, Senior Counsel, Access to Justice, U.S. Department of Justice
Daniel Olmos, Senior Counsel, Access to Justice, U.S. Department of Justice
Ira Goldstein, The Reinvestment Fund, Workshop Facilitator
10:15 – 12:00 Framing the Issue: Foreclosure Mediation Program Stakeholders Discuss Program
Objectives and Research and Evaluation Needs.
10:15 – 11:00 Presentations
Roberta Palmer, Program Manager, Connecticut Judicial Branch Foreclosure
Mediation Program
Jennifer Sinton, Deputy Director, South Brooklyn Legal Services Foreclosure
Prevention Project
Geoff Walsh, Attorney, National Consumer Law Center
11:00 – 12:00 Facilitated Roundtable Discussion
This panel will discuss foreclosure mediation program models, emerging trends and
program objectives, and will discuss the need for research and evaluation of program
impact and what work has been done to address those needs. Discussion will also focus
on the various partnerships that mediation programs have created to conduct research and
evaluation, views of the stakeholders regarding the benefits and drawbacks of various
partnership models, and suggestions for ways in which the federal government can
support research and evaluation efforts.
Foreclosure Mediation Programs
A Workshop to Discuss Emerging Research and Evaluation Practices
March 7, 2011
Sponsored by U.S. Department of Justice’s Access to Justice Initiative
12:00 – 1:00 Working Lunch
Margaret Richardson, Counselor to Attorney General for Executive Branch Relations
Keynote Speaker: Dr. Raphael Bostic, Assistant Secretary for Policy Development and
Research at the U.S. Department of Housing and Urban Development
1:00 – 2:45 Researchers Discuss Challenges and Lessons Learned from Evaluation of
Foreclosure Mediation Programs and Related Foreclosure Prevention Interventions.
1:00 – 1:45 Presentations
Ira Goldstein, Director, Policy & Information Services, The Reinvestment Fund
Kathryn Wertheim Hexter, Director, Center for Community Planning and
Development, Cleveland State University
Peter Tatian, Senior Research Associate, The Urban Institute
1:45 – 2:45 Facilitated Roundtable Discussion
This panel will explore research methodologies, data sources, and data collection
techniques, related challenges, and lessons learned from research. The discussion will
also focus on prioritization of types of data collection and evaluation in view of resource
limitations, and the relative benefits and drawbacks of the various methodological
models.
2:45 – 3:00 Break
3:00 – 3:45 Facilitator-Led Discussion of the Highlights from the Day
In this facilitated round-table, participants will have a chance to comment on the day’s
highlights and discuss next steps.
Adjourn
Foreclosure Mediation Programs
A Workshop to Discuss Emerging Research and Evaluation Practices
March 7, 2011
Sponsored by U.S. Department of Justice’s Access to Justice Initiative
PARTICIPANT LIST
Laura Abel
Deputy Director, Justice
Program
Brennan Center for Justice
New York, NY
Robert Avery
Senior Economist
Federal Reserve Board
Washington, DC
Sally Bartholmey
Director of Mediation
Strategies & Deployment
Fannie Mae
Dallas, TX
Karen Black
Principal
May 8 Consulting, Inc.
Media, PA
Kenneth P. Brevoort
Senior Economist
Federal Reserve Board
Washington, DC
Jana Burch
Director of Operations
Maryland Office of
Administrative Hearings
Hunt Valley, MD
Melanca Clark
Senior Counsel
Access to Justice Initiative
U.S. Department of Justice
Washington, DC
Alon Cohen
Consultant, Housing
Center for American Progress
Washington, DC
Juan Cuba
Special Assistant, Office of the
Secretary
U.S. Department of Housing
and Urban Development
Washington, DC
Jett Davison
Deputy Program Director
Collins Center for Public
Policy
Tampa, FL
Rebekah Diller
Deputy Director, Justice
Program
Brennan Center for Justice
New York, NY
Sean Dunham
Program Counsel
Collins Center for Public
Policy
Tampa, FL
Tais Ericson
Deputy Director, Civil Matters
Connecticut Judicial Branch
Court Operations Unit
Wethersfield, CT
Rachel Gallegos
Law Clerk to the Hon. Judge
Annette Rizzo Philadelphia
Court of Common Pleas
Philadelphia, PA
Ira Goldstein
Director, Policy &
Information Services
The Reinvestment Fund
Philadelphia, PA
Solomon J. Greene
Senior Program Officer
Open Society Foundations
New York, NY
Kathryn Wertheim Hexter
Director, Center for
Community
Planning and Development
Cleveland State University
Cleveland, OH
Michael Hickey
Executive Director
Center for NYC
Neighborhoods
New York, NY
Andrew Jakabovics
Advisor to the Assistant
Secretary for
Policy Development and
Research
U.S. Department of Housing
and Urban Development
Washington, DC
Devin Johnson
Legislative Affairs Specialist
Washington D.C. Department
of Housing and Community
Development
Washington, DC
Kirsten E. Keefe
Senior Attorney
Empire Justice Center
Albany NY
1
Foreclosure Mediation Programs
A Workshop to Discuss Emerging Research and Evaluation Practices
March 7, 2011
Sponsored by U.S. Department of Justice’s Access to Justice Initiative
PARTICIPANT LIST
Karen Lash
Senior Counsel
Access to Justice Initiative
U.S. Department of Justice
Washington, DC
Deborah Leff
Deputy Counselor for Access
to Justice
Access to Justice Initiative
U.S. Department of Justice
Washington, DC
Eileen Mauskopf
Senior Economist
Federal Reserve Board
Washington, DC
Neil Mayer
Neil Mayer & Associates
Albany, CA
Ashley McAskill
Presidential Management
Fellow
U.S. Department of Housing
and Urban Development
Washington, DC
Janice Mitchell
Strategic Program Specialist
Washington D.C. Department
of Housing and Community
Development
Washington, DC
Marina L. Myhre, Ph.D.
Social Science Analyst
Program Evaluation Division
Office of Policy Development
& Research
U.S. Department of Housing
and Urban Development
Washington, DC
Daniel Olmos
Senior Counsel
Access to Justice Initiative
U.S. Department of Justice
Washington, DC
Lynn Overmann
Deputy Counselor for Access
to Justice
Access to Justice Initiative
U.S. Department of Justice
Washington, DC
Roberta Palmer
Program Manager
Connecticut Judicial Branch
Foreclosure Mediation
Program
Wethersfield, CT
Edward (Ned) Pope
Director, Florida Mortgage
Foreclosure Mediation
Program
Collins Center for Public
Policy
Tampa, FL
Eileen Pruett
Manager, Small Claims
Division and
Dispute Resolution Programs
Franklin County Municipal
Court
Columbus, OH
Roberto Quercia
Professor and Director of
Center for Community Capital
University of North Carolina
Chapel Hill, NC
Margaret Richardson
Counselor to the Attorney
General for Executive Branch
Relations
U.S. Department of Justice
Washington, DC
Ira Rheingold
Executive Director
National Association of
Consumer Advocates
Washington, DC
Richard Schauffler
Director, Research Services
National Center for State
Courts
Williamsburg, VA
Denise Shaffer
Administrative Law Judge
Maryland Office of
Administrative Hearings
Hunt Valley, MD
2
Foreclosure Mediation Programs
A Workshop to Discuss Emerging Research and Evaluation Practices
March 7, 2011
Sponsored by U.S. Department of Justice’s Access to Justice Initiative
Doreen Solomon
Assistant Director
Executive Office for United
States Trustees
U.S. Department of Justice
Washington, DC
Jennifer Stinton
Deputy Director
Foreclosure Prevention
Project
South Brooklyn Legal Services
Brooklyn, NY
Peter Tatian
Senior Research Associate
The Urban Institute
Washington, DC
Stephen Taylor
General Counsel
Department of Insurance
Securities and Banking
Washington, DC
Ken Temkin
Temkin Associates
Rockville, MD
Kate Titford
Counsel – Office of General
Counsel
NeighborWorks America
Washington, DC
Kathryn Tuck
Program Analyst
State Justice Institute
Reston, VA
PARTICIPANT LIST
Geoffry Walsh
Attorney
National Consumer Law
Center
Boston, MA
Nick White
Evaluations Director
Maryland Mediation and
Conflict
Resolution Office
Maryland Judiciary
Annapolis, MD
Rachel Wohl
Executive Director
Maryland Mediation and
Conflict
Resolution Office
Maryland Judiciary
Annapolis, MD
Susan M. Yates
Executive Director
Resolution Systems Institute
Chicago, IL
Kenneth H. Zimmerman
Lowenstein Sandler
Member of the Firm
Roseland, New Jersey
3
Foreclosure Mediation Programs
A Workshop to Discuss Emerging Research and Evaluation Practices
March 7, 2011
Sponsored by U.S. Department of Justice’s Access to Justice Initiative
PANELIST BIOS
Dr. Raphael Bostic (Keynote Speaker) was sworn in as HUD’s Assistant Secretary for Policy
Development and Research (PD) on July 16, 2009, following his confirmation by the U.S. Senate. As
a key member of HUD’s senior leadership, Dr. Bostic is the principal advisor to the Secretary on
overall Departmental policy, program evaluations, demonstrations, and research.
Dr. Bostic leads a multi-disciplinary team of approximately 140 economists, analysts, engineers,
architects and social scientists and is responsible for providing economic information and analyses
of housing and community development statistics and other data. PD performs short- and long-
term analysis and evaluations to help the Secretary and other principal staff make informed decisions
on HUD policies, programs, as well as budget and legislative proposals. These activities provide the
Department and the nation with current information on housing needs, market conditions, and
research on important housing and community development issues.
An expert on housing and homeownership, Dr. Bostic served as a professor in the University of
Southern California’s School of Policy, Planning, and Development where he examined how credit
markets, financing, and policy enhance household access to economic and social amenities. He was
Director of USC’s Master of Real Estate Development degree program and was the founding
director of the Casden Real Estate Economics Forecast. Prior to that, he worked at the Federal
Reserve Board of Governors, where he was recognized a Special Achievement Award for his
performance associated with a review of the Community Reinvestment Act.
This is Dr. Bostic’s second tour of duty at HUD. During the Clinton Administration, he served as a
special assistant for PD Assistant Secretary Susan Wachter. He earned his Ph.D. in Economics from
Stanford University and his BA from Harvard University.
Ira Goldstein, Ph.D., is the Director of Policy Solutions at The Reinvestment Fund (TRF), a
results-oriented, socially responsible community investment group that works across the mid-
Atlantic region. Dr. Goldstein has conducted detailed analyses of mortgage foreclosures for each
state in the mid-Atlantic under contracts with the Federal Reserve, Pennsylvania and Delaware
Departments of Banking, and the community and economic development agencies in Pennsylvania
and New Jersey. Together these projects resulted in the direction of benefits and added consumer
protection to tens of thousands of homeowners. Dr. Goldstein has also been engaged in an
evaluation of the impacts and outcomes of the Philadelphia Residential Mortgage Foreclosure
Diversion Program – a novel judicial intervention designed to afford homeowners facing foreclosure
1
Foreclosure Mediation Programs
A Workshop to Discuss Emerging Research and Evaluation Practices
March 7, 2011
Sponsored by U.S. Department of Justice’s Access to Justice Initiative
PANELIST BIOS
an opportunity to avoid losing their homes at Sheriff Sale. Formally trained as a sociologist, Dr.
Goldstein’s research and testimony provided expert support to discrimination cases brought by the
PA Human Relations Commission, US Attorney for the Eastern District of Pennsylvania and legal
service attorneys. Prior to joining TRF, Dr. Goldstein was the mid-Atlantic Director of Fair
Housing and Equal Opportunity for the US Department of Housing and Urban Development. He is
a member of the Consumer Advisory Council of the Federal Reserve Board as well as a member of
the Research Advisory Board of the Center for Responsible Lending and the Governor of
Pennsylvania's Housing Advisory Committee.
Kathryn Wertheim Hexter serves as director of the Center for Community Planning and
Development and The Levin College Forum. She joined the Levin College of Urban Affairs in
1986. A planner and public policy analyst, Ms. Hexter has over 25 years of experience managing and
directing research projects and evaluating programs in the areas of mortgage foreclosure, housing
policy, neighborhood development, sustainable development, low-income energy assistance, city and
regional planning and civic engagement. She has worked extensively with federal, state and local
governmental, philanthropic and non-profit organizations. She is the founding director of the Levin
College Forum Program, recognized by Northern Ohio Live (2005) as “a springboard for economic
and social progress throughout the region” and recipient of the national 2003 CivicMindTM award.
The Forum brings together the university and the community to address critical public policy issues
that impact Northeast Ohio, the state and the nation. Ms. Hexter holds a masters degree in City and
Regional Planning from Harvard University. Prior to joining the College she worked in community
and governmental relations for the East Ohio Gas Company and as a planner for a local consulting
firm.
Roberta Palmer is a Program Manager for the State of Connecticut, Judicial Branch. She manages
all civil ADR programs including the Foreclosure Mediation Program. This program was
established in July 2008 and was the first statewide, court-based foreclosure mediation program in
the country. Roberta is responsible for developing, managing and monitoring the program to ensure
compliance with statutes, program guidelines and Judicial Branch goals and objectives. The program,
as it exists today, consists of 25 mediators, 9 caseflow coordinators and 17 office clerks who are
responsible for assisting lenders and homeowners reach agreement in their foreclosure action.
Roberta has been employed by the Judicial Branch for over 20 years. Prior to her present position,
she was a housing mediator for the court operations unit of the Branch for 18 years where she
mediated landlord/tenant cases and conducted civil pretrials for the court. Roberta is a graduate of
Boston College and Hofstra University School of Law.
2
Foreclosure Mediation Programs
A Workshop to Discuss Emerging Research and Evaluation Practices
March 7, 2011
Sponsored by U.S. Department of Justice’s Access to Justice Initiative
PANELIST BIOS
Jennifer Sinton is the Deputy Director of the Foreclosure Prevention Project at South Brooklyn
Legal Services. Sinton came to SBLS from Lambda Legal, where she specialized in civil rights
litigation brought on behalf of people living with HIV and co-authored the D.C. Circuit appellate
brief for Taylor v. Rice (reversing summary judgment and granting plaintiff a trial to determine
whether U.S. Foreign Service could exclude candidates with HIV under the Rehabilitation Act).
Earlier, Sinton was lead attorney on appeal in the First Department for Housing Works’ lawsuit
Melendez v. Wing, which invalidated a Department of Social Services regulation that reduced the
plaintiff’s public assistance benefits in violation of the NY State Social Services Law. Sinton also was
co-counsel on the appeal of Henrietta D. v. Bloomberg (establishing that City of New York violated
ADA by failing to provide reasonable accommodations to public assistance recipients), and
monitored compliance with the injunctive relief obtained in that federal class action. At SBLS,
Sinton litigates predatory lending and foreclosure defense cases in federal and state court. Sinton
received her J.D. magna cum laude from Brooklyn Law School and an A.B. from Brown University.
Peter A. Tatian is a Senior Research Associate in the Urban Institute's Metropolitan Housing and
Communities Policy Center. Mr. Tatian's areas of interest include housing policy, neighborhood
indicators, and community development. He is one of the key staff on the Institute's National
Neighborhood Indicators Partnership, which makes use of local data to promote community
building activities in over thirty US cities, and is currently leading the Institute's NeighborhoodInfo
DC partnership, a neighborhood data system and civic engagement tool for the District of
Columbia. He is also directing the Urban Institute's evaluation of NeighborWorks® America's
National Foreclosure Mitigation Counseling program, a $343 million program providing counseling
services to homeowners facing foreclosure. Mr. Tatian co-directed the Neighborhood Change Data
Base project, which brought together comparable neighborhood-level indicators from the 1970 to
2000 Decennial Censuses. In 2005, he co-wrote a study on the neighborhood impacts of
community development strategies in Richmond, Virginia. He has also done research for HUD on
the impacts of public and supportive housing on neighborhoods, and has worked on housing policy
reform in Eastern Europe and the former Soviet Union.
3
Foreclosure Mediation Programs
A Workshop to Discuss Emerging Research and Evaluation Practices
March 7, 2011
Sponsored by U.S. Department of Justice’s Access to Justice Initiative
PANELIST BIOS
Geoff Walsh worked as a legal services attorney for over twenty-five years before joining the staff
of the National Consumer Law Center. He is presently a staff attorney with NCLC’s Boston office.
Before that he worked with the housing and consumer units of Community Legal Services in
Philadelphia and was a staff attorney with Vermont Legal Aid in its Springfield, Vermont office. His
practice has focused upon housing and bankruptcy issues. He is a contributing author to NCLC’s
publications Consumer Bankruptcy Law and Practice, Foreclosures, and Student Loans. He is co-
author of two recent studies by NCLC on issues affecting the current foreclosure crisis: Foreclosing
a Dream: A Study of State Foreclosure Laws and State and Local Foreclosure Mediation Programs:
Can they Save Homes?
4
Court of
Common
Pleas
Plaintiff
Philadelphia
County
No.
v.
Sheriff
Book Writ
Sheriff
Sale
Date:
Conciliation
Conference Date:
Housing
Counselor:
Housing
Counseling
Agency:
VIP
Attorney:
Other
Attorney
(include
I.D. #):
Dcfendant(s)
Day
Backward
Case
No.
ORDER
AND
NOW.
this
day of
,2010,
upon
consideration
of
the
information
provided
to the
Court,
it is hereby
ORDERED
that:
1.
The defendant having failed to meet
with
a housing counselor and/or having failed to appear for the Conciliation Conference, the above
premises
shall proceed to Sheriff Sale on , 2010 unless otherwise postponed by Plaintiffs attorney or by
court order.
2.
The Sheriff Sale is stayed. [ORSTY]
Please Detail Basis for
Stay:
Home Affordable Modification Program Loan Modification
Traditional Loan Modification Loan has been paid in
full
Deed in Lieu of
Foreclosure
Loan has been brought current by the following:
Short sale Repayment Agreement
Other (Summarize on reverse) Forbearance Agreement
Full
Arrears Payment
3.
A bankruptcy has been filed and the plaintiff may direct the Sheriff to postpone the sale, in accordance
with
Pa.R.Civ.P.
3129.3;
otherwise the sale shall be stayed. Upon plaintiff securing relief from the automatic stay or an order is entered dismissing the
bankruptcy, in the case of any continued or postponed Sheriff
sale,
the plaintiff shall file a Praecipe requesting that the Conciliation
Conference
be scheduled, before such postponed sale shall take place.
4.
The Sheriff Sale is Postponed to , 2010 for the following reason:
A Conciliation Conference is scheduled for , 2010 at
AM/PM
(at least 10 days
before the sale date) in Courtroom 676 City Hall, Philadelphia, PA to determine if the sale can go forward.
5. The Underlying Action is Settled. The Sheriff Sale is Cancelled. [ORSET] Please explain basis for resolution:
6.
I"l A Conciliation Conference is scheduled for , 2010 at ________
AM/PM
in Courtroom 676 City
Hall,
Philadelphia, PA. The Sheriff Sale is scheduled for
,2010.
7. The Sheriff Sale remains at
,2010.
8. Property is not owner-occupied. Reason: _ ____
BY THE COURT:
The
Honorable Annette M. Rizzo
:Court of Common
Pleas
Conciliation Conference Date
Plaintiff.
Philadelphia County Housing Counselor
: Housing Counseling Agency
: Docket No VIP Attorney;
Defendant(s) :Day Forward
Case
No. Other Attorney (include l.D. #
FIRST
CONCILIATION
CONFERENCE
LISTING
ORDER
AND NOW. this of 2010, upon consideration of the information provided to the Court, it is hereby
ORDERED
and
DECREED
that:
1.
"The Complaint and
Case
Management Order having been served on Delendant(s) at least fourteen (14)
days
prior
to today's date, and
Defendants) having failed to appear for the First Conciliation Conference. Plaintiff is free to enter a default judgment against Defendant(s) to
the
extent permitted by the applicable rules of Civil Procedure, the
Case
Management Order
notwithstanding.
2. The Complaint and
Case
Management Order having not been served on Defendant(s). Plaintiff shall reinstate the Complaint to obtain a new
First Conciliation Conference date not
less
than 45
days
from the dale of
reinstatement,
and then
serve
the Complaint and
Case
Management
Order on Defendant(s). Plaintiff is stayed from entering a Default Judgment against Defendant(s) before one day after the First Conciliation
Conference Fisting occurs or
until
such time as is stated in a subsequent Order.
3. The Complaint and
Case
Management Order having been served on Defendant(s) at least fourteen (14)
days
prior
to today's date, and
Defendant(s) having appeared for the First Conciliation Conference Fisting as ordered, a
Second
Conciliation Conference Listing is scheduled
in
City Hall Courtroom 676. as follows:
Second
Conciliation Conference Date and Time (35
days
from today) Date: Time: __.
Defendant(s) is/are required to submit their complete financial package to Plaintiffs counsel at least fourteen (14)
days
prior
to the
aforementioned
Second
Conciliation Conference Listing Date. Plaintiff is stayed from entering a Default Judgment against Defendants)
before
one day after the
Second
Conciliation Conference occurs or
until
such time as is stated in a subsequent Order.
4.
A bankruptcy
petition
has been
filed.
Upon termination of the automatic slay. Plaintiff shall
file
a
Praecipe
requesting that a Conciliation
Conference be scheduled. Plaintiff is stayed from entering a Default Judgment against Defendant(s) before one day alter the First Conference
occurs or
until
such time as is stated in a subsequent Order.
5.
Case
has been (or
will
be) discontinued by Plaintiff.
Reason
(select one):
Home Affordable Modification Program
Loan
Modification
Loan
has been paid in
full
Traditional
Loan
Modification
Deed
in Lieu of Foreclosure
1
Short
sale
Other:
Loan
has been brought current by the
following:
Repayment Agreement •• Forbearance Agreement • Full Arrears
Payment
6.
The parties
have
entered
into
the following agreement:(select one):
Repayment Agreement Forbearance Agreement
Home Affordable Modification Program Trial
Plan
i Traditional Modification Trial
Plan
Other:
Further Disposition (select one):
The Agreement
will
not result in the loan being brought current. A follow up conciliation conference is scheduled for
_____ at o'clock in City Hall Room 676. Plaintiff is stayed from entering a Default Judgment against Defendants)
before
one day after this conference occurs or
until
such time as stated in a subsequent Order: or
The Agreement
will
result in the loan being brought current as long as there is no breach by Defendanl(s). If there is a breach by
Defendant(s), then Plaintiff shall,
prior
to taking judgment,
serve
a notice of
intention
to lake default judgment pursuant to Pa.
R.C.P.
No. 237.1
with
an attached notice of the
Save
Your Home Philly Hotline.
These
notices shall be served on Defendant(s). counsel for Defendants) (if
any), the Housing Counselor, and the VIP attorney (if any) (indicated above) in
care
of Philadelphia VIP. If Defendants) complete(s) the plan,
then
Plaintiff shall discontinue this
case.
7. Plaintiff is free to enter a default judgment against Defendant(s) to the extent permitted by the applicable rules of Civil Procedure, the
Case
Management Order
notwithstanding.
Reason:
The parties agree the subject property is non-residential and/or non-owner occupied . A default judgment shall not be entered before
The parties
have
agreed that the subject properly shall be sold at Sheriff's
sale
no earlier than
8. i Other: (describe)
__Date
Date:
Attorney
for Plaintiff
Defendants) or Attorney for Defendant(s)
BY THE
COURT:
The Honorable Annelle M. Rizzo
Court
of Common
Pleas
Conciliation
Conference Date
Plaintiff.
:Philadelphia County Housing Counselor:
V.
:Docket No.
Housing Counseling Agency:
VIP Attorney:
Dcfcndant(s) Day Forward
Case
No.
Other Attorney (include I.D. #)
ORDER
FOR
SECOND
AND
SUBSEQUENT
LISTING
OF
CONCILIATION
CONFERENCE
AND NOW, this of
2010.
upon consideration of the information provided to the Court, it is hereby
ORDERED
and
DECREED
that:
1.
Plaintiff
is free to enter a default judgment against Defendant(s) to the extent permitted by the applicable rules of Civil Procedure, the
Case
Management Order
notwithstanding.
Reason
(select one):
The failure of Defendant(s) to appear
The parties agree the subject property is non-residential and/or non-owner occupied. Judgment may not be entered earlier than
The parties
have
agreed that the subject property shall be sold at Sheriff s
sale
no earlier than -
i The unexcused failure of Defendant(s) to forward the required financial information to Plaintiff's counsel at least fourteen (14)
days
prior
to
today's date.
The parties
have
entered
into
the following agreement: (select one):
Repayment Agreement Forbearance Agreement Other:
Home Affordable Modification Program Trial
Plan
Traditional Modification Trial
Plan
Other:
Further Disposition (select one):
The Agreement
will
not result in the loan being brought current. A follow up conciliation conference is scheduled for
___________
at
o'clock in City Hall Room 676. Plaintiff is stayed from entering a Default Judgment against Defendant(s)
before
one day after this conference occurs or
until
such time as stated in a subsequent Order: or
The Agreement
will
result in the loan being brought current as long as there is no breach by Dcfendant(s). If there is a breach by
Defendant(s), then Plaintiff
shall,
prior
to
taking
judgment,
serve
a notice of
intention
to take default judgment pursuant to Pa.
R.C.P.
No. 237.1
with
an attached notice of the
Save
Your Home Philly Hotline.
These
notices shall be served on Defendant(s), counsel for Defendant(s) (if
any), the Housing Counselor, and the VIP attorney (if any) (indicated above) in
care
of Philadelphia VIP. if defendant(s) complete(s) the plan,
then
Plaintiff shall discontinue this
case.
3.
Case
has been (or
will
be) (select one) discontinued by Plaintiff.
Reason:
i
Case
has been (or
will
be) discontinued by Plaintiff.
Reason
(select one):
Home Affordable Modification Program
Loan
Modification
Loan
has been paid in
full
Traditional
Loan
Modification
Deed
in Lieu of Foreclosure Short
sale
Other:
Loan
has been brought current by the
following:
Repayment Agreement Forbearance Agreement Full Arrears
Payment
4.
A bankruptcy
petition
has been
filed.
Upon termination of the automatic stay. Plaintiff shall
file
a
Praecipe
requesting that a Conciliation
Conference be scheduled. Plaintiff is stayed from entering a Default Judgment against Defendant(s) before one day after the
Second
Conference occurs or
until
such time as stated in a subsequent Order.
5. The parties arc attempting to reach an agreement. A new conciliation conference is scheduled for ___
-
2010 at
o'clock in Courtroom 676 City Hall. Philadelphia. Plaintiff is stayed from entering a Default Judgment against Defendant(s)
before
one day after this conference occurs or
until
such time as stated in a subsequent Order.
6.
Other:
(Describe)
Date
Rate
Plaintiff
or Counsel for
Plaintiff
Defendant(s)
or Counsel for
Defendant(s)
BY THE
COURT:
The Honorable Annette M. Rizzo
n
n
g
g
g
g
g
g
g
1. Default Section
*
1. Observation Information
Your Name
Borough
JHO/Referee
Conferences w/in last
24 hrs
6
2. What type of court room are you in?
m
Court room (large room, jury box etc)
lkj
m
Small conference room
lkj
Other (please specify)
6 6
3. Which (if any) court personnel were present at the conference?
f
JHO
edc
f
Referee
edc
f
Judge
edc
f
I am not sure but it was a Judge or a JHO or a Referee
edc
f
Clerk
edc
f
none of the above
edc
f
Other
edc
Other (please specify)
*
4. Start/End Time of the conference
HH
MM
AM/PM
Start Time
End Time
:
:
6
6
*
5. Case Index Number: IF YOU DON'T KNOW ENTER 000-
0000
Index #
Year (####)
6. Names of the Parties
Plaintiff
Defendant
Servicer
Page 1
n n n n n
n n n n n
n n n n n
n
n
n
g
g
g
g
g
7. Did the homeowner default (fail to show up)?
m
Yes (click "Next" at bottom of page to skip to end of survey)
lkj
m
Yes but I want to continue entering data
lkj
NO, Homeowner or his/her attorney attended (use this if HO didn't show up because Attny was there for them -
non default)
mlkj
8. What race (to the best of your ability to judge) is:
Asian/Pacific
Black
Hispanic
White
Other/unknown
Islander
Homeowner
Additional Homeowner
nmlkj nmlkj mk nlj mknlj mk lnj
l m mk mmlj mk lj lj ljk j k k
1
Additional Homeowner
2
Additional Homeowner
nmlkj nmlkj mk nlj mknlj mk lnj
l m mk mmlj mk lj lj ljk j k k
3
Plaintiff's counsel
nmlkj nmlkj mk nlj mknlj mk lnj
JHO/Referee
mlj mk lj lj ljl m mk mkk j k
Defendant's counsel
nmlkj nmlkj mk nlj mknlj mk lnj
9. What is the property address and date of purchase?
Address:
Address 2:
ZIP/Postal Code:
Home Purchase Date
Block
Lot
10. Does it seem like the Homeowner qualifies under the law? (to the best
of your ability to tell at the conference
-
please check all that seem to apply)
Got loan between 2003-2008
fedc
The loan is "high-cost"
fedc
f
The loan is "subprime"
edc
f
The loan is "nontraditional"
edc
f
The Homeowner lives in the property
edc
If no why not?
5
5
6
6
Page 2
n
n
n
n
n
n
11. Who was present at the conference?
Homeowner/Borrower
Attny for Defendant (at
least provide name of
firm/non-profit
organization)
Attny for Plaintiff (at
least enter name of
firm)
Lender or Servicer
present by phone? If
so - who?
Tenant
Interpreter
Other (please indicate
role)
12. Did the defendant have an attorney? if so... what type
NO ATTORNEY - Pro Se
mlkj
m
Private attorney
lkj
m
Volunteer attorney
lkj
m
Not for profit counsel: Legal Services/Legal Aid or other NFP
lkj
m
Had Attny but I don't know what type
lkj
m
If you know where attny was from please add it here
lkj
Page 3
n
n
n
n
n
n
n
n
n
n
n
2. Background Information
1. Who spoke first at the conference?
m
Attorney for Plaintiff
lkj
m
Attorney for Defendant
lkj
m
Defendant
lkj
m
Judge/JHO/Referee
lkj
m
Court Clerk
lkj
Other (please specify) or explain your answer above:
5
5
6
6
2. Did the homeowner speak at all?
m
NO AND the homeowner was appearing pro se
lkj
m
NO BUT the homeowner's attorney/representative spoke
lkj
m
YES
lkj
Please feel free to explain your answer
5
5
6
6
3. When was the last time the homeowner paid their mortgage? (please
enter all you can determine from the discussion at the conference)
Month and Year of last
payment:
Number of months
behind:
Dollar value of arrears:
Other indicator of when
default occurred:
4. Is this the first conference?
m
Yes
lkj
m
No
lkj
m
Other (please specify)
lkj
Page 4
n
n
n
n
n
n
n
n
3. Prior Conference Information
Answer questions here only if there was a prior settlement conference.
1. If no, how many conferences have been held before
Number of prior
conferences (not
including current
conference):
2. Did the court seem to recall what occurred at the prior conference?
(Please explain the basis for your reply if it isn't clear from your answer
below)
5
5
6
6
3. Who explained what occurred at the prior conference?
m
Attorney for Plaintiff
lkj
m
Attorney for Defendant
lkj
m
Defendant
lkj
m
Judge/JHO/Referee
lkj
m
Clerk for Court
lkj
m
NA (this is the first conference)
lkj
m
No one (AND there were prior conferences held)
lkj
m
Other
lkj
Please explain your answer:
5
5
6
6
Page 5
n n n
n n n
4. During the Conference
Please track information from during the conference here.
1. Please indicate whether any or all of the following occurred at the
settlement conference:
Yes
No
NA
Court recommended
Defendant open an
escrow account:
nmlkj nlj mkmk nlj
Court made an
k l mmlj mk ljj k
affordability inquiry:
Court used 31% of
gross income in its
affordability analysis:
Homeowner/HO's
nmlkj nlj mkmk nlj
k l mmlj mk ljj k
representative
proposed an
alternative affordable
payment:
2. If the court did an affordability analysis, please describe this conversation
and your sense of whether the homeowner could afford what was
proposed. If you are unable to determine whether the payment was
affordable, what information did the court have that you didn't have?
5
5
6
6
Page 6
g
g
g
g
g
g
g
g
g
g
g
g
g
g
g
3. Did the Homeowner appear to be prepared for the settlement
conference? (check all that apply)
f
Presented an offer in advance of the conference.
edc
f
Presented an offer at the conference.
edc
f
Had a budget prepared.
edc
f
Had seen a housing counselor.
edc
f
Had seen an attorney.
edc
f
Came with documents.
edc
f
Had questions prepared.
edc
f
Was saving money for mortgage (escrow account or some sort of savings account)
edc
f
Already negotiated a short sale
edc
f
Had already submitted a modification packet
edc
f
Was actively working on a modification packet
edc
Other (please specify)
5
5
6
6
4. If the homeowner was working with a housing counselor, please answer
the below question:
f
Was a modification packet completed?
edc
f
Did the homeowner know if the housing counselor had submitted their modification packet to their servicer?
edc
f
Did the homeowner have a copy of a modification packet their housing counselor had completed?
edc
f
Was the housing counselor available by phone?
edc
Please include the name of the housing counseling agency and any other information that seems relevant to you.
5
5
6
6
Page 7
g
g
g
g
g
g
g
g
g
g
g
g
g
g
g
g
g
g
g
g
*
5. Did the court engage in moving the settlement conference toward a
conclusion?
f
Inform homeowner if their servicer is signed up for HAMP and explain what that means.
edc
f
Ask questions of the homeowner (eg: inquire into the story of what happened).
edc
f
Determine whether the homeowner had submitted a modification packet.
edc
f
Inquire into the status of a modification submitted.
edc
f
Do an affordability analysis.
edc
f
Suggest terms for a modification that could make the loan affordable.
edc
f
Order the production of a payment history?
edc
f
Outline a timeline for the settlement conference to follow in moving forward?
edc
f
Require explanations if a homeowner is denied a modification?
edc
f
Determine how far apart each party is in their settlement negotiation.
edc
f
Ask either side what they have been doing to further a settlement.
edc
f
Request that someone with the authority to settle the case appear at the next conference.
edc
f
Place a call to someone with the authority to settle?
edc
f
Deny a request to get someone with authority to settle on the phone?
edc
f
Inquire into the details of a settlement (if case settled)?
edc
f
Ask to speak privately with either party in order to discuss a possible settlement?
edc
f
None of the above
edc
Other (please specify)
5
5
6
6
6. Did the plaintiff's counsel appear engaged in moving the conference
forward?
f
Brought a workout packet to this (or prior) conference.
edc
f
Provided the homeowner with a payoff letter at this (or prior) conference.
edc
f
Provided the homeowner with a payment history at this (or prior) conference.
edc
Other (please specify)
5
5
6
6
Page 8
g
g
g
g
n
n
n
n
n
7. Did the plaintiff's counsel seem aware of the details of the status of the
case?
f
Was aware that an offer had been submitted.
edc
f
Knew the status of an offer that was submitted.
edc
f
Had a copy of the offer that was submitted.
edc
f
Knew whom to contact to see whether an offer was going to be accepted.
edc
Other (please specify)
5
5
6
6
8. If an offer was already submitted by the homeowner please answer the
following questions:
m
Did the homeowner have a copy of the offer?
lkj
m
Had the homeowner sent a copy of the offer to the plaintiff's attorney?
lkj
m
Did the homeowner know precisely when the offer was submitted?
lkj
m
Did the homeowner have proof that the offer was submitted?
lkj
m
NA
lkj
Please feel free to explain your answer
5
5
6
6
Page 9
n
n
5. Outcome of Settlement Conference
*
1. Please indicate which of the below describe the conclusion of the
conference:
Conference was
adjourned to:
The homeowner didn't
show up and the case
was marked off
(Default):
The conference was
settled (details of
settlement):
A short sale was
agreed upon:
Conference was
marked off but not
settled (default,
returned to trial judge,
foreclosure allowed to
proceed etc):
Kicked out of
Settlement Conference
Part (or recommended
for dismissal) because
loan doesn't qualify for
Settlement Conference
Not clear what the
outcome was
Other:
2. If you think this homeowner's case presents a particularly compelling
story please elaborate here.
5
5
6
6
3. Other information you think we should have about this case.
5
5
6
6
4. Did you do an interview for this homeowner?
m
Yes
lkj
m
No
lkj
Page 10
n
n
6. Homeowner Interview Page
1. Was this your first settlement conference?
m
Yes
lkj
m
No
lkj
2. If no, how many conferences have you had before? and when was the
first one?
5
5
6
6
3. How did you hear about the settlement conferences?
5
5
6
6
4. What did you know about the conference before you decided to attend?
5
5
6
6
5. Was it what you expected?
5
5
6
6
6. Why did you decide to attend?
5
5
6
6
7. Do you miss work when you attend a settlement conference?
5
5
6
6
8. What do you do for a living? Are you a union member? (if yes, which)
5
5
6
6
9. What is your understanding of what you accomplished in court today?
5
5
6
6
Page 11
10. Your home
When did you buy your
home?
Do you live in the
home?
How many homes do
you own?
11. Your loan
Is this the first time
you have fallen behind
in your loan?
What happened that
caused you to fall
behind?
How many mortgages
do you have?
12. Getting a modification
Have you tried to work
out an arrangement
with your
bank/servicer?
Who is your servicer
(who do you pay the
mortgage to)?
How many times have
you called them?
What was the result?
How would you
describe the
experience?
Did they offer you a
modification or some
other way to avoid
foreclosure?
Was this affordable to
you?
13. Have you worked with anyone to try and address your foreclosure?
If yes: Who?
If no: Why not?
How did you find
them?
Did you have to pay?
If yes, how much?
What did they do?
Would you recommend
them to your friends?
Page 12
n
n
14. If someone wanted to follow up with you after today, would that be
okay?
m
Yes
lkj
m
No
lkj
If yes, what's your phone #
Page 13
7. End of Survey
Suggestions for how this survey instrument can be improved (please feel free to elaborate on this, it is a work in
progress).
Page 14
