What is the State of Nevada Foreclosure Mediation Program?
The State of Nevada Foreclosure Mediation Program (FMP) allows homeowners to sit down with mortgage lenders and trained mediators, to discuss alternatives to foreclosure. Mediation is a process of give and take and the parties must negotiate in good faith. If a homeowner requests mediation, the lender may not foreclose until mediation has been concluded.
How Do I Request Mediation?
Nevada homeowners are automatically enrolled in mediation after the filing of a Notice of Default and Election to Sell notice with the County Recorder. The lender is required to provide the homeowner with a copy of the NOD and information on how to schedule foreclosure mediation. An Enrollment Form must be returned to the FMP within 30 days of receiving the NOD or within 20 days of receiving service of a judicial complaint (in the event of a judicial foreclosure). Failure to return the Enrollment Form and a fee of $200 will result in the FMP issuing a Certificate to the lender allow it to proceed with the foreclosure.
A Notice of Default Has Not Been Filed on My Property, But I Am At Risk of Losing My Home. Can I Participate In Mediation?
Yes, the 2015 Nevada Legislature approved SB 512, which allows homeowners with a documented financial hardship and in imminent risk of mortgage default, to participate in foreclosure mediation prior to the issuance of a Notice of Default (NOD).
A HUD-approved housing counseling agency must determine the financial hardship preventing the homeowner, or the person who holds the title of record, from being able to make a mortgage payment within the next 90 days.
A list of HUD-approved housing counseling agencies can be found under Foreclosure Resources.
Two forms are required to participate in Pre-NOD Mediation:
In addition, the homeowner must submit to the Foreclosure Mediation Program (FMP) a mediation fee of $200.
Can I Participate in Foreclosure Mediation and Elect Bankruptcy?
Foreclosure Mediation is not available to homeowners with an active bankruptcy per NRS 107.086 and FMP Rules. Foreclosure mediation is an option only after a bankruptcy has been cleared, discharged, or a stay has been lifted on the home. Often, homeowners will seek to be permitted to enter into the FMP following the discharge of a bankruptcy. Usually, this is arranged by court order or an Order Vacating Stay (OVS).
After I Request Foreclosure Mediation, What is the Next Step?
Within 10 days of the FMP receiving all necessary documents and fees from both the homeowner and the lender, a mediator will be assigned. Mediations are required by NRS 107.086 to be concluded within 135 days of the FMP’s acceptance of all funds and the Enrollment Form from the homeowner requesting mediation be scheduled. After a mediator is assigned, a document conference will be scheduled and both parties will submit the required documents prior to mediation. The mediator will schedule a mediation approximately 60 days from the document exchange conference.
What Can Be Done in Mediation?
Mediation allows the parties, homeowner and lender, to sit down face-to-face to discuss alternatives to foreclosure. In some cases, this is the only opportunity homeowners have to meet with the lender and talk about the future of the loan. Mediation can result in a loan modification or an agreement to relinquish the property through a short sale. Mediation reduces the uncertainty of the future and provides a meaningful opportunity to consider all options.
What Can the Mediator Do?
The Mediator’s role is to help the parties work toward a reasonable resolution to a mutual problem. The Mediator is not a judge who decides a case and cannot give legal advice. The mediator is in charge of the process and will set the time and location for the mediation after consulting with the parties. Mediators also will make decisions on any requests for continuance or postponement. Mediators are randomly assigned from a list of qualified and trained individuals.
What If I Fail to Participate in the Document Conference?
Deadlines established by FMP Rules require homeowners and lenders to exchange documents prior to a scheduled mediation. Homeowners have 15 days after receiving a list of required documents from their lender to complete and return the documents. This exchange process was created to provide lenders with all of the information needed to consider alternatives to foreclosure.
When homeowners fail to return the needed documents, they risk not reaching an agreement in mediation. This can result in the issuance of a certificate allowing the lender to foreclose.
Homeowners do not have to tackle this requirement alone. The Home Again Nevada initiative will connect a homeowner with a HUD-approved housing counselor to assist in preparing for mediation. Homeowners can call 1-855-457-4638 statewide and be connected to a counselor who can help them prepare for mediation.
Failure to return documents in a timely manner will likely result in no agreement to avoid foreclosure at mediation. To improve the chances of finding an alternative to foreclosure, such as a loan modification, it is important documents are returned within the deadlines established by the FMP Rules.
What If My Lender Refuses to Participate in Foreclosure Mediation?
Once a homeowner requests to schedule mediation, the lender is required to participate in good faith and have someone at the mediation with the authority to negotiate or modify a loan. In addition, the lender must bring to mediation the original or certified copy of the Mortgage Note, the original or certified copy of the Deed of Trust, and the original or certified copy of each assignment of the Mortgage note and Deed of Trust.
The lender must also produce the an Appraisal or Broker’s Price Opinion of the property done no more than 60 days before the beginning of the mediation and prepare an estimate of the short sale value of the home.
A failure to participate, have authority to negotiate, or bring the required documents to mediation prevents a lender from proceeding with the foreclosure.