DC Foreclosure Mediation Rules Announced

Posted on May 25, 2011

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The new DC foreclosure rules are out, and it is very interesting to read.

Practically speaking, all foreclosures in DC have been on hold since November of last year since the new law has passed. The rules implementing the new foreclosure law are now public and allow homeowners to ask for foreclosure mediation.

One striking characteristic of the new rules is that is allows the mediator to fine the mortgage company $500 a day for not negotiating in good faith. That option is a striking difference with the Maryland foreclosure mediation rules, which have no punitive provisions. Having sat through a few foreclosure mediations in Maryland, it does not surprise me that some sort of punishment was put in place to inspire the banks to deal honestly. Most of what I have seen is people sending all the requested information to the bank and then having it misplaced or lost, and then using that as a basis to deny a modification.

More to come on the specifics of DC’s new foreclosure rules.

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