In December of 2009, Maryland governor Martin O’Malley (D) assembled a group of legislative staff, housing counselors, lawyers, bankers and mortgage servicers to create a foreclosure mediation program for the state to help “bridge the huge gap” for people eligible for federal foreclosure prevention but denied modifications from lenders due to failure to provide paperwork or meet other criteria[1]. Hopes were high that the program, since implemented, would help homeowners establish face-to-face relationships with their lenders and work out modifications or other foreclosure alternatives. Sadly, only about 100 homeowners have received a modification through the program in the past year[2]. It should be noted that 150 additional homeowners have been allowed to stay in their houses until a “final resolution” on their foreclosure is reached.

Not surprisingly, the parties involved blame each other. Lenders cite homeowners’ failure to show up, deliver important documents or meet financial criteria. Homeowners and their advocates say that the process is just one huge delay, with one homeowner waiting for over six months to hear the first thing from her lender. So who’s to blame? Do you think these programs ultimately do any good?

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