Malloy Would Improve Foreclosure Mediation Process to Help Homeowners
Gov. Dannel P. Malloy called upon lawmakers Wednesday to quickly pass a bill streamlining the foreclosure mediation process with the goal of keeping distressed homeowners in their homes.
Malloy held a press conference with Attorney General George Jepsen and Banking Commissioner Howard Pitkin to announce new legislation, which will require that banks have a representative with the authority to settle the mediation process at every mediation session with homeowners.
The governor called the current foreclosure mediation process “overly bureaucratic.”
“That level of bureaucracy is compounded by the fact that you don’t frequently meet with the same person and more times than not, the person you’re meeting with has no authority to make a decision,” he said.
Malloy said he wanted to make sure the process is designed so that homeowners know quickly whether they will be able to reach a deal to stay in their homes. The bill, which has yet to be submitted to the legislature, also will prevent homeowners from facing foreclosure-related litigation while they’re engaged in mediation.
Two distressed homeowners spoke at the press conference about their frustrations dealing with the foreclosure process. Linda Casanova, of Bristol, said she struggled to keep her home after she lost her job. She was served with foreclosure paperwork in 2010 and started mediation later that year.
“It was not a good experience for me. Never had a positive suggestion. I felt mediation did everything to discourage me from finding a solution,” she said.
Debbie Sargunas, of Thomaston, also had a bad experience with her bank in mediation. She said the process took a year and she was meeting with a different lawyer every month.
“If the governor’s bill had been in place, I believe our problem would have been resolved sooner,” she said.
Malloy called the women a “couple of fighters” and said their stories demonstrate the need for the legislature to act quickly on the bill.
“This is legislation that should not wait until the last day of the session to be passed. It should be taken up as quickly as possible,” he said. “As you know we have a large volume of cases outstanding and I believe this legislation could help settle some of those in a timely fashion.”
The governor said the bill, which also includes language to “fast-track” the process for some abandoned and blighted properties, was based on best practices from around the country. It will be included in the legislative package he will release Feb. 6 when he will announce his proposed budget.
Tags: foreclosure, mediation, homeowners, Malloy, Jepsen
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