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The Challenge of Establishing the Nevada Foreclosure Mediation Program

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AUGUST 2009
NEVADA LAWYER
BY BILL GANG, PUBLIC INFORMATION OFFICER, NEVADA SUPREME COURT
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NEVADA LAWYER
AUGUST 2009
The Nevada Supreme Court unanimously adopted the rules us. In addition to direct testimony, the Supreme Court on June 30, just a day before the legislation went into effect. accepted written comments about the draft rules. The first mediations are expected to occur in August. Under the Supreme Court Rules, the homeowner The new rules and other information about the Foreclosure must submit copies of financial records and indicate the Mediation Program are available on the Supreme Court website: amount of a mortgage payment that could be made if a www.nevadajudiciary.us. Click on the foreclosure mediation loan modification could be reached. Lenders must submit link on the home page, found on the far right-hand side of the documents indicating current appraisals of a home’s value black navigation bar. and estimates of what it could sell for in a so-called short The Administrative Office of the sale. Lenders must have someone I believe that through Courts is overseeing the program and either at the mediation, or available, has been in the process of hiring staff, with the authority to modify a loan this new law and our finding facilities, obtaining furniture and provide the original or certified mediations, we are going and establishing training programs copies of the mortgage note, deed to save some homes and, for the numerous mediators that are of trust and any assignments of the at the same time, help expected to be needed. Former casino mortgage note or deed of trust. ease the burden for executive Verise Campbell has been The rules require that the some lenders. hired as the Nevada Foreclosure parties in a mediation act in Mediation Program administrator “good faith.” While the program to oversee the legislatively created project. Veteran mediator will offer homeowners the opportunity to sit down with Kathryn Ely has been hired as mediation supervisor to help their lenders and try to solve their mutual predicament, coordinate the selection and training of the numerous mediators mediation will not be the solution for everyone and some expected to be needed. homes, inevitably, will be lost to foreclosure. More than 400 attorneys and trained mediators have According to the Supreme Court Rules, mediation offered to become part of the program. Initially, however, the generally will not delay the foreclosure process. Mediations program is expected to utilize senior judges and Supreme Court must be scheduled within 90 days so, if they are not settlement judges, all of whom have already received extensive mediation training. COnTInUEd On PAgE 26 Nevada averages about 7,600 foreclosures a month, with the vast majority in Clark County. “Many Nevadans are losing their homes to foreclosure,” said Chief Justice James W. Hardesty. “I believe that through this new law and our mediations, we are going to save some homes and, at the same time, help ease the burden for some lenders.” The Supreme Court began working to expedite the mediation program even before AB149 was passed. “We knew that the bill likely would pass and we knew that the time frame would be short for creating a system to handle what may be an overwhelming number of cases,” Hardesty said. “The Supreme Court proactively took steps to prepare for what is now a reality.” LCL Coordinator The Supreme Court held public hearings about the proposed rules on June 16 in the Carson City courtroom, and on June 26 in the Las Vegas courtroom. Each hearing was videoconferenced to the other courtroom, and interested individuals could testify from either location. The hearings were also webcast live over the Supreme Court website; audio files of the hearings remain available on the foreclosure mediation webpage, on the website, www.nevadajudiciary.
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AUGUST 2009
NEVADA LAWYER
THE nEvAdA FORECLOSURE MEdIATIOn PROgRAM
COnTInUEd FROM PAgE 25
successful, lenders may proceed program. You can contact Sheila According to the Supreme with foreclosures within the MacDonald at (775) 687-9816, Court Rules, mediation current statutory time frame. or foreclose@nvcourts.nv.gov. generally will not delay the AB149 only affects singleThe chief justice emphasized family, owner-occupied housing that the foreclosure mediation foreclosure process. in Nevada and currently applies program is self-funded through only to foreclosure notices (formally known as Notice of fees and will not require the expenditure of any taxpayer Default and Election to Sell) filed on or after July 1, 2009. dollars. Lenders pay a fee for filing a foreclosure The bill gives borrowers 30 days to seek mediation of a notice, which is used to fund administrative costs of the mortgage loan once a foreclosure has been filed. Lenders program. Homeowners and lenders will share the $400 must participate in mediations. costs for the mediators, with each party paying $200 A request form and easy-to-understand instructions prior to the mediation. will accompany the foreclosure notices when they are served. That form, along with other forms and bIll GANG is public information officer for the Nevada information, is available on the Supreme Court website. Supreme Court. Prior to joining the court in 2000, he The Administrative Office of the Courts has was a reporter for the Las Vegas Sun who covered the established a hotline phone number for questions about the courts for 12 years.
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