Foreclosure mediation can begin with new law

Print
Email
|

by JESSE JONES / KING 5 News

Bio | Email | Follow: @getjesse

KING5.com

Posted on September 1, 2011 at 6:24 PM

Updated Thursday, Sep 1 at 6:41 PM

SHELTON, Wash. -- Karen Warren’s home in Shelton isn't the nicest in town. The front yard has no grass, but the backyard makes up for it.

But what is here isn't always found in a sparkling mansion. It's an overgrowing and overflowing sense of family.
 
Nine people live in the home which includes her daughter and six grandchildren.

“The only thing you have to hold on to is your family and your children,” said Karen.
 
Karen like thousands of other Washingtonians is facing foreclosure. But relief may be in sight thanks to a new law.
 
The Foreclosure Fairness Act allows struggling homeowners to meet with their lender and go through mediation in hopes of working things out.

“I'm really happy. I hope it works out, I'm real sure it will,” Karen said. “I know its business, but it's my business to take care of my family.”
 
Karen has a chance because she spoke to a housing counselor who got her in touch with Rory O'Sullivan from the non-profit Northwest Justice Project, who will represent Karen in the mediation.

“She was actually working with a bank she was about to get a loan modification and the loan got transferred to a new bank," said O'Sullivan. "And the new bank said they didn't want to work with her.”
 
In mediation, both sides will provide a net present value test.

“It is a calculation that determines if the bank is going to make more money by foreclosing or make more money by modifying the loan," O’Sullivan said. "In Ms.Warren’s case the bank can make more money modifying her loan and this is true of many people.”
 
Karen has a steady income but that may not be enough to save her home. She wants people to know she is not a charity case.

”We want to work with them. We don't want any handouts just a plan, and I think mediation was the answer to all of that,” said Karen.
 
Her mediation case is set for next Tuesday. We will bring you an update after that meeting.

For more information on the Foreclosure Fairness Act, visit http://www.commerce.wa.gov/site/1367/default.aspx or call the Washington Homeownership Resource Center at (206) 542-6644 to set up a free housing counselor call.
 

Print
Email
|