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The Benefits of Foreclosure Mediation

By: Amber E. B. McMichael, Esquire

            This article is to point out and explain the benefits of foreclosure mediation as well as introduce myself and why I have an interest in foreclosure mediation. Foreclosure mediation is a new process that is long overdue. It helps homeowners keep a roof over their heads and lenders preserve their assets. Florida and local Bar newsletters reflect the crisis now underway. The Florida Circuits have been trying to implement new processes to help and assist Florida Homeowners with this ever growing foreclosure epidemic. For instance, in the First, Eleventh, and Nineteenth Circuits they have employed the use of the Collins Center for Public Policy while other Circuits are applying their own processes. The Fifteenth Circuit is not making mediation mandatory but is reaching out to each homeowner/borrower and asking if they would like to mediate; if so they are given instructions and steps on what to do next.

             My name is Amber McMichael and I am a Supreme Court Certified Civil Circuit and Family Mediator and I am also a licensed and practicing Florida Attorney.[1] I hold a Masters of International Business Administration as well. I am a transplant from North Carolina, came here for law school, met my wonderful husband and have built my life here. I have always had an interest in Real Estate Law, which started when I was employed by a well known and well respected law firm in Greenville, North Carolina while attending college. I am experienced in real estate law, estate planning, evictions, business law, and family law.

            One of my main goals of becoming a certified mediator was to mediate foreclosures. I handle every kind of civil dispute but helping people stay in their homes is a special calling. Just a year ago no one was conducting foreclosure mediations. No one knew how to implement mediation in the foreclosure process. My interest of foreclosure mediation stemmed from my clients. Too many clients were coming to me asking me for guidance and assistance regarding their mortgages. I knew when I was conducting the closings that something was going to hit the real estate market and it wouldn’t be good. The loans people were qualifying for were outrageous and the prices of the properties being purchased were astronomical. I knew that the market would not be able to sustain itself. Unfortunately what I had feared came to fruition: the real estate bubble burst. I had clients coming to me to help them figure out their options: modification, short sale, deed in lieu, foreclosure. I would contact the lenders on end and around the clock which was very time consuming and at times frustrating. As a professional, I was speaking to several different people, if I was even able to get a person and leaving message after message, and it would take days sometimes to get any kind of response. So I could only imagine what my clients were feeling and experiencing without my involvement as well as those borrowers who had no representation. For a borrower it can be extremely overwhelming and frustrating when you never speak to the same person, each person never tells you the same thing, and then you do not understand the terms they are using or how exactly they affect you. That is when I realized that if mediation was an option during a foreclosure proceeding and preferably pre-suit we could really make an impact on the foreclosure epidemic; without another option, lenders would face massive asset write-downs and losses. Mediation brings the borrower and the lender face to face and provides a win-win option instead of a sure lose-lose result.

            Foreclosure mediation benefits both the borrower and lender in several ways. The benefits to the borrower consist of: assisting the borrower in finding a way to stay in the property; or getting the borrower out from under the property with the least damage to their credit; allows the borrower to have a say in the outcome of the matter; and most of all gives the borrower a voice which alleviates their stress and anxiety. The lender benefits in the following ways: obtaining a work out means no additional inventory; caps and stops expenditures such as maintenance, legal fees, and time; allows for the lender to engage in direct contact with the borrower to obtain necessary information regarding borrower; and most of all implements a work out so they have a performing loan and their asset is protected.

            I have seen these benefits take place first hand during the foreclosure mediations I have conducted. The borrowers are relieved to be able to talk to a person who has authority to make a decision over their mortgage and the lender is ready, willing, and able to assist the borrower anyway they can. Even when keeping the property is not an option, mediation almost always provides better choices than litigation does. In this particular instance the borrowers are of course sad to lose the property but are nevertheless relieved to have the burden of the property lifted from their shoulders. Likewise, the lender is pleased to stop the bleeding of unnecessary expenses and litigation costs. Most of the mediations end with a modification or trial modification which pleases both sides. The homeowner/borrower gets to stay in the property and the lender gets a performing loan. No matter how the matter is resolved, mediation allows the parties to collectively determine and decide the best outcome for each individual circumstance and work towards a common goal. Additionally, it allows those directly affected by the real estate slump to regain their stability. All in all the foreclosure mediations are a win/win for all involved.[2][3]

[1] Complete resume at:

[2]As of Monday, December 28, 2009 the Florida Supreme Court handed down an Administrative Order for all the Florida Circuits to mimic; making mediation mandatory for all residential homestead foreclosures. This Order confirms that mediation benefits the Borrower, Lender and even our Courts.

[3] Complete Florida Supreme Court Administrative Order can be found at:

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