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On December 19, 2011, the Florida Supreme Court issued an Administrative Order discontinuing the state’s mandatory foreclosure mediation program.  The residential mortgage foreclosure mediation program was established in December of 2009 to address the foreclosure crisis in the state’s courts.  Although no cases filed after December 19, 2011 will be required to be referred to the mediation program, the Court clarified that the cases currently pending mediation on the date of the issuance of the administrative order will still be able to complete the mediation process. 

Reportedly, the mediation program was never very successful. Statewide, less than 4 percent of cases referred to mediation resulted in an agreement between the parties. In Palm Beach County, the numbers are even more disappointing – less than 2 percent.  Often times, lenders could not reach the borrowers to set the mediation; other times, the lenders came to the mediation with no intentions to actually reach an agreement; and many times, the borrowers came to the mediation with no real ability to work anything out due to economic strains.

The Florida Supreme Court’s decision to terminate the foreclosure mediation program does not necessarily mean that the program or some form of it will cease to exist throughout the state. For instance, the Fifth Judicial Circuit Court has already indicated its intention amend its county administrative order to continue its mandatory managed mediation program.  Some other circuits may do the same.

 —Craig I. Kelley, West Palm Beach Bankruptcy Attorney of Kelley & Fulton, P.L., represents individual and business debtors and creditors in Chapter 7, 11, 12, and 13 proceedings. He is A.V. rated by Martindale-Hubbell directory, which is the highest rating as voted on by his peers in the legal profession. He is an Adjunct Professor of Bankruptcy Law at Palm Beach Community College and lectures nationally on the subject. For more information about bankruptcy, visit www.KelleyLawOffice.com or contact Craig I. Kelley by calling 561-491-1200 or by emailing info@kelleylawoffice.com.

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