Foreclosure Mediation in Connecticut Just So-So.

This week, Governor Jodi Rell issued a press release touting the success of the foreclosure mediation program in Connecticut.  She claims a 75% success rate in mediating foreclosure cases where 2721 homeowners saved their home.  Lies, damn lies, and statistics.

The report covers the period of July 2008 (when mediation become available in Connecticut) to the end of October 2009.  In July 2009, mediation became mandatory in all residential foreclosures.  During that time only 4,448 cases were put into mediation, yet over 32,000 foreclosures were filed in the state.  So in reality, less than 14% of the cases were mediated at all.

If we define ‘success’ as the number of families that got to stay in their home versus the number of homes foreclosed, we can see that the success rate was really only 8.5%, not 75%!   This is not a criticism of the mediators who work hard to get recalcitrant lenders to the table.  Unfortunately, they are powerless to force the lenders to do anything at all.  They should be commended for accomplishing anything in the face of the volume of foreclosures and the difficulty of a declining market.

Using the Governor’s methodology, the program has left 25% of homeowners in limbo and convinced 13.5% of the homeowners to leave their home.  This is hardly a glowing endorsement of the state’s efforts.

About Eugene Melchionne Attorney at Law

Eugene S. Melchionne, Esq. - Mr. Melchionne is a graduate of The University of Connecticut (B.A. 1977) and Drake University School of Law (J.D. 1980) where he received the American Jurisprudence Award for academic excellence.Since 1980, Mr. Melchionne has focused his practice in the areas of consumer bankruptcy, workouts and foreclosure defense in distressed real estate markets, real estate transactions, condominium law, commercial litigation, business organizations and probate. Prior to opening his office in 1990, Mr. Melchionne was associated with Grady & Riley in Waterbury, Connecticut and DiPietro, Kantrovitz & Brownstein, P.C. in New Haven, Connecticut. From 1990-1998, Mr. Melchionne was of counsel to Bender & Anderson handling that firm's complex litigation and trials. In addition to his practice, Mr. Melchionne was an adjunct professor at the American Institute of Banking and Teikyo Post University teaching bankruptcy, real estate, commercial and consumer law. Mr. Melchionne also advised the Corporation Counsel's office for the City of Waterbury on bankruptcy and foreclosure matters and mentored junior attorneys in that office. In 2005, Mr. Melchionne was appointed State Chair for the National Association of Consumer Bankruptcy Attorneys (NACBA). He acts as a liasion between the national organization and Connecticut attorneys who are members of the Association. He has fostered education of attorneys in the bankruptcy field and increased access of the public to bankruptcy relief in light of the law passed in 2005. In 2007, Mr. Melchionne was elected as Vice President of the Bankruptcy Law Network, an internet resource for consumer information on bankruptcy and now serves as its President. Bankruptcy Law Network has three sister sites, Credit Law Network, Debt Law Netowrk and Mortgage Law Network. Areas Of Practice: Consumer Bankruptcy Workouts & Foreclosure and Repossession Defense Real Estate Closings Honors: Super Lawyer Connecticut - 2007, 2008 Member of the Month - April 2006, National Association of Consumer Bankruptcy Attorneys American Institute of Banking Community Service - Ken Kovel Award, 2001 Teacher of the Year, American Institute of Banking, 1998 Pro Bono Representation of Indigent Clients, U.S. Bankruptcy Court, District of Connecticut, 1996 - 2002 American Jurisprudence Award 1978   Classes/Seminars Taught: Speaker - NACBA 2009 Convention, Chicago, IL Speaker - NACTT 2009 Convention, Boston MA Speaker - NACBA 2008 Workshop, Hilton Head, SC Speaker - NACBA 2008 Convention, Los Angeles, CA Speaker - NACBA 2007 Workshop, Las Vegas, NV Speaker - NACBA 2007 Convention, Philadelphia, PA Adjunct Professor - Bankruptcy, Real Estate, Consumer, and Commercial Law, American Institute of Banking and Teikyo Post University Past/Present Affiliations: National Association of Consumer Bankruptcy Attorneys American Bankruptcy Institute American Institute of Banking, Northwest Region Council City of Waterbury Corporation Counsel - Advisor, 1996 - 2000 Waterbury Bar Association - Chair, Committee on Bankruptcy -1998 Waterbury Credit Bureau, Inc. - Vice President, 1983 - 1985 American, Connecticut, and Waterbury Bar Associations Admitted: Connecticut, 1982 U.S. Federal Court, 1982 Education: Drake University Law School, Des Moines, IA, J.D. - 1980 University of Connecticut, Storrs, CT, B.A. - 1977 Past Positions: Bender & Anderson, Of Counsel, Hamden, Conn. DiPietro, Kantrovitz & Brownstein, P.C., New Haven, Conn. Grady & Riley, Waterbury, Conn.
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