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Loopholes Still Found in Tax Credits and Mediation Programs



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By : John Cutts    99 or more times read
Foreclosure-mitigation programs like tax credits, loan modifications, and mediation between lenders and borrowers all have areas that needed ironing out. In Nevada, both lenders and homeowners have found that out as they continuously make suggestions on how to improve the state's mediation initiative for the better.

The Foreclosure Mediation Program administered by the Nevada Supreme Court was meant to prevent homes from getting sold at Las Vegas foreclosure auctions before a discussion was held between lenders and borrowers. And just like any other foreclosure program, complaints have remained and authorities constantly make changes to adopt the concerns expressed by both parties.

Among the concerns expressed by borrowers was the need for the program to keep tabs of lenders who do not bother to negotiate before foreclosing and selling borrowers' properties at home auctions in Nevada. They suggested that the state should give such lenders financial sanctions that will be based on how often these lenders have refused to enter a negotiation with their borrowers. Another complaint was that some banks allegedly charge homeowners the full mediation fee when the rule states that the $400 should be divided evenly between lenders and borrowers.

Just like in loan modifications and tax credits programs, documentation is a big part of Nevada's mediation program. In some cases, lawyers representing homeowners have complained that a number of judges allegedly grant foreclosure authority despite lenders not having enough documents to prove their case during court proceedings, declaring that there is sufficient evidence that a foreclosure is justified.

In this regard, lawyers representing homeowners who had their houses sold at foreclosure auctions have asked the courts to clarify what the concept of good faith entails in a mediation negotiation. They also asked the Supreme Court to explain the level of significance given by the high court to deliberations conducted in district courts during appeals. Terminologies, authorities' roles and sanctions are also some of the issues that require clarification, homeowners and their lawyers have stated.

With the government tax credits program already behind the housing market, homeowners are hoping that lenders will be more amenable to negotiations since banks will likely lose more in selling properties through foreclosures than if they willingly modify a loan or reduce mortgage principals.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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