The operation of Connecticut’s Foreclosure Mediation Program through its first five months illustrates a couple of themes that are common to most mediation processes. In an article in the December 8, 2008 Hartford Business Journal titled “Mediation Helps 360 Postpone Foreclosure”, Greg Bordonaro described the program, with comments from various viewpoints. One positive note is that over 360 homeowners reached a settlement that allowed them to keep their homes, while another 116 homeowners left their homes but reached an agreement with a lender to pay off the remaining balance of their mortgage.
Some might feel that only those who were able to keep their homes achieved a “win” here. But those who reached agreement to pay off their mortgage came out of the mediation process in a better position than when they began. Undoubtedly they saw an advantage to that result (less damage to their credit records would be one likely benefit) or they would not have agreed to it. If it had been possible, and in the best interests of both the lender and the homeowner in those cases to reach a settlement that allowed them to stay, a mediator would have helped them reach that resolution. Instead, the homeowners — and lenders — reached a mediated solution that might be described as half a loaf, which is definitely better than none.