Nevada’s foreclosure mediation program has had mixed results, few of them resulting in principal reductions. However, in the good news department, thanks to a Nevada Supreme Court ruling a homeowner won sanctions against a lender that participated in foreclosure mediation in bad faith. Here are the facts.
· The homeowner, Miguel Jacinto, emerged from a successful mediation with Citimortgage with an agreement to enter into a Home Affordable Modification Program (HAMP) loan modification. Citimortgage then denied Jacinto a HAMP modification, leading him to demand a Nevada district court grant him sanctions against Citimortgage for failing to mediate in good faith. Instead, the court ordered a second mediation.
· Citigroup assigned the mortgage to PennyMac Corp., which attended the mediation without bringing the promissory note, deed of trust, and a “Broker’s Price Opinion.” PennyMac’s representative also lacked the authority to negotiate on the bank’s behalf. Again Jacinto brought his case to a district court, which granted him attorney’s fees and refused to issue a Foreclosure Mediation Program certificate, but declined to give him monetary sanctions and a judicially imposed loan modification.
· On appeal, the Nevada Supreme Court discussed whether Jacinto was an aggrieved party with a right to appeal (he was), and whether the district court was within its discretion to award the sanctions that it did and not order a judicially imposed loan modification. The court found that the district court was within its discretion to not order further penalties against PennyMac.
The case is captioned Jacinto v. PennyMac.
Foreclosure mediation is mandatory for homeowners facing foreclosure as a result of the real estate bust that afflicts the state. Consequently, when banks take a lackadaisical attitude to the process, it’s the homeowners who suffer most. Although Jacinto received $3,500 to reimburse him for his attorney’s fees, it still didn’t solve his mortgage problem that Citimortgage was supposed to resolve in Jacinto’s first mediation and PennyMac in the second. Because mortgage mediation can be a sketchy process, it’s important to discuss your mortgage problems with an experienced Las Vegas bankruptcy attorney before foreclosure can become an issue.
For more questions about bankruptcy in Las Vegas, please feel free to contact an experienced Haines & Krieger Las Vegas bankruptcy attorney for a free initial consultation. Call us at 1-702-880-5554 to set up your free consultation.