Governor Rell: Gov. Rell Celebrates Success of Mandatory Mortgage Mediation Program


{Seal of the State of Connecticut}

STATE OF CONNECTICUT
EXECUTIVE CHAMBERS
HARTFORD, CONNECTICUT  06106

M. Jodi Rell
Governor

FOR IMMEDIATE RELEASE
November 23, 2009
Contact: 
860-524-7313

Governor Rell Celebrates Success of

Mandatory Mortgage Mediation Program

 

Program Has 75 Percent Settlement Rate Through October 31,

Helping Nearly 3,000 Homeowners Stay in Homes

 

 

            Governor M. Jodi Rell today announced that the state’s foreclosure mediation program she championed with the co-chairs of the Legislature’s Banks Committee continues to help thousands of Connecticut residents avoid the loss of their homes.

 

            During the recent session, Governor Rell, Senator Bob Duff and Representative Ryan P. Barry developed legislation making mediation a mandatory part of all real estate foreclosures in Connecticut.  Under the provisions of the new law, a lender can no longer proceed to foreclose on a home without first going through a court-supervised effort to reach a fair, voluntary, negotiated agreement regarding the property with the homeowner.

 

            The bill grew out of a voluntary program that was achieving remarkable success, resolving about 70 percent of cases amicably. In August, Governor Rell signed into law Senate Bill 948, An Act Concerning Implementation of the S.A.F.E. Mortgage Licensing Act, which makes mediation mandatory for all foreclosure proceedings that began after July 1, 2009.

 

            During a legislative forum last week, Judicial Branch officials announced that the now-mandatory program had handled a total of 4,448 cases through October 31. Of those, 2,721 cases resulted in the homeowner staying in the home and another 611 resulted in agreements for a short sale, a deed in lieu or an extension of the law day or sale date – a settlement rate of 75 percent.

 

            “This is a tremendous success story – truly a bright spot in an otherwise very grim situation,” Governor Rell said. “Clearly, mediation is an effective tool homeowners can use to ward off foreclosure. No one ‘wins’ when a foreclosure is completed – the borrower loses the home they have struggled to purchase, the lender is saddled with a property they do not want and neighbors see their property values dip. This program is a beacon of hope for hard-pressed homeowners and a real alternative for lenders.”

 

            Senator Duff (D-25), said, “The foreclosure mediation program we created in 2008 is simple, effective and a model for the rest of the nation. The majority of individuals and families get to stay in their homes, banks and lenders are not left with properties to dispose of and communities are spared the drop in property values and increase in crime that go hand-in-hand with foreclosure.”

 

            Representative Barry (D-12) added, “Just as we hoped, extending the mortgage mediation program has meant we can help more people than ever before. With layoffs and the overall economy continuing to take a serious toll on Connecticut families, programs such as mortgage mediation are more critical than ever. I am proud of the collaboration between the Banks Committee, the Legislature and the Governor.”

 



Content Last Modified on 11/23/2009 4:38:58 PM






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