Foreclosure mediation plan approved by Nevada Assembly
Sun News Service
CARSON CITY, Nev. ” The Assembly Tuesday gave unanimous approval to legislation mandating mediation before a home can be foreclosed.
Assembly Speaker Barbara Buckley, D-Las Vegas, was the prime sponsor of AB149.
She said it was made necessary because of the “so-called creative financing which fueled the real estate boom we enjoyed in the 2000s.”
She said artificially low interest rates and “exotic” mortgage schemes lured thousands of buyers into the housing market.
“It all came crashing down as these loans began to reset to their above-market rates,” she told fellow Assembly members.
“One of the most common complaints among homeowners during this foreclosure crisis is that they cannot even reach their lenders to try to renegotiate a home loan when they are in trouble,” she said.
She said foreclosures of those homes began to devastate neighborhoods, hurting the values of homes financed through conventional mortgages and leaving “Nevada caught in a downward economic spiral.”
Nevada has the nation’s highest foreclosure rate.
“AB149 is designed to get buyers and lenders together to work out a reasonable repayment agreement that will keep buyers in their homes,” she said.
It requires that, before a non-judicial foreclosure can occur, the borrower and owner of the mortgage must sit down and try reach agreement on how to keep the homeowner in the house.
The Nevada Supreme Court will administer the program which Buckley said more than 100 lawyers and all senior judges in the state have agreed to serve. She said they will get the necessary training to become mortgage mediators and to handle those cases for a maximum of $300.
She said mediation could prevent an estimated 17,700 foreclosures in Nevada, saving more than $1.6 billion in lost tax collections.
“We can help stabilize neighborhood real estate values, keep Nevadans in their homes and stem lender losses that are drying up access to credit
“We can help stabilize neighborhood real estate values, keep Nevadans in their homes and stem lender losses that are drying up access to credit,” she said.
AB149 goes to the Senate.
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