Posted by: euser
March 08, 2010
Topic: Legal News

Update on Mediation in Mortgage Foreclosures

On December 29, 2009 the Florida Supreme Court adopted the Residential Mortgage Foreclosure Mediation Program. The order set forth very specific procedures, which apply to all residential mortgage foreclosure actions in which the note and mortgage were subject to the provisions of the Federal Truth and Lending Act. Any newly filed foreclosure actions must be referred to this program unless the parties agree otherwise. The Parties must go to mediation prior to entry of a final judgment. The original summons issued in the case must have attached to it a notice regarding this mediation for homestead residences.

The order requires the Plaintiff to disclose certain evidence prior to the mediation including: a) Any documentary evidence showing the Plaintiff is the owner of the mortgage b) The history of all payments c) A statement as to the present net value of the mortgage loan and d) The most current appraisal of the property. The mediation shall be scheduled no earlier than 60 days and no later 120 days after the suite is filed. If a partial or final settlement is reached, it must be reduced to writing and signed by the parties. All communications relating to the mediation shall be confidential and inadmissible in any subsequent legal preceding.

Failure to comply with the administrative order will prevent scheduling of a trial or a summary judgment motion and can result in the imposition of sanctions, including dismissal of the case. The Plaintiff pays $750.00 in mediation fees, but if the mediation is unsuccessful the Judge may require the non-prevailing party to pay it as part of the cost of the lawsuit. The administrative order also sets forth a timeline as to when the various steps of the mediation must be accomplished and is attached as part of exhibit 1 to the order.

On February 11, 2010 the Florida Supreme Court also adopted a number of significant amendments to the Florida Rules of Procedure relating to foreclosure actions. These include but are not limited to:

•1) Rule 1.110(b) was amended to require that a mortgage foreclosure complaint involving residential real property must be sworn to under oath by the Plaintiff. The purpose is to resolve the issue up front as to whether the Plaintiff is the current owner and holder of the note and mortgage.

•2) The court adopted a new form 1.924 which is the predicate affidavit required prior to service on a Defendant by publication.

•3) The court amended form 1.996(a) to change the form of a final judgment of foreclosure to delete certain privacy information and to provide for electronic sales on a website. It also put in notices concerning the possibility that other parties may be entitled to excess funds bid at the foreclosure sale.

•4) It adopted new form 1.996(b) Motion to Cancel and Reschedule Foreclosure Sale. The purpose of this form is to avoid last minute cancellation of foreclosure sale and require that a court order such a cancellation.

Update on Mediation in Mortgage Foreclosures

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