Foreclosure-mediation laws not much help

[forum_admin]

Laws in California and other states requiring mortgage companies to talk to troubled homeowners before foreclosing on them are toothless, according to a study released Wednesday.

The National Consumer Law Center, which analyzed programs in 14 states, said they have failed to help homeowners stave off foreclosure because they lack sanctions or accountability for banks.

"There is as yet no data to confirm that foreclosure-mediation programs anywhere have led to a substantial number of affordable and sustainable loan modifications," the report said. "The existing programs routinely fail to impose significant obligations on mortgage servicers (without which) it is unlikely that mediations will lead to fewer foreclosures."

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