Program aims to ease Walworth County home foreclosures
Photo 
John Race
Photo
John Maier Jr.
ELKHORN — Walworth County Judge John Race opened a mountain-size dictionary to research the origin of a word that he’s reading more often than he cares to these days.
The word is “mortgage.”
It’s of French origin and means “dead debt” or “death pledge,” Race said with a slightly baffled look.
Likely, the irony gave him pause.
Walworth County mortgages have been dying in record numbers.
In 2010, more than 800 mortgage foreclosures were filed in Walworth County and 28,000 statewide, according court records. A financial instrument that once provided the working class with the hope of home ownership is now tainted as an assassin of the American dream.
Alarmed by the numbers, Race and a handful of local lawyers and financial advisors have started a mediation program intended to give homeowners a fair shake when facing foreclosure.
Race said his court is flooded with “rock solid” people who face the loss of their homes.
Those homeowners can no longer make mortgage and property tax payments for reasons beyond their control, he said.
Race reported he once had a pile of foreclosure lawsuits in his chambers that measured 4 feet high. He said he’s grown tired of seeing the tears of men and women who feel helpless, hopeless and potentially homeless.
He wanted to do something to set their minds at ease, give them some sense of protection and security.
To help homeowners navigate the complicated foreclosure process, which often befuddles attorneys, the Walworth County Foreclosure Mediation Program was developed from a model crafted by attorneys Natalie Fleury and Debra Tuttle at Marquette University Law School.
It began last summer after Race got a call from Elkhorn attorney John Maier, who was alarmed with the rising number of foreclosures.
“There is no hiding from the fact that the economy has been in recession and that we are living in a period of sustained high unemployment,” Maier said, “Everyone knows someone that has either lost their job or is afraid of losing their job.”
Maier and other local attorneys began researching what could be done to mediate with mortgage lenders to resolve or slow foreclosure actions so the affected could, if needed, make a “graceful exit.”
A common obstacle in resolving pending foreclosures is reaching someone from a lending company who can negotiate a settlement. Mortgages are bought and resold on financial markets, making it difficult to track down a lending official with authority to resolve an issue, Race said.
Some homeowners have only the general telephone number of the lending company that wants to foreclose, Race said. Since the foreclosure mediation program started, foreclosure actions are not allowed to go forward unless homeowners and lenders have attempted mediation.
Race said it’s Wisconsin’s progressive laws that prevent homeowners from being tossed onto the street if they miss mortgage payments.
The mediation model is used successfully by Milwaukee County, Race said.
Rock County started a similar program in late 2009.
The program launched in Walworth County on Nov. 1, after the four Walworth County judges approved its use. It accepts only new foreclosure cases and has 15 participants.
The volunteer program is only for mortgages held by homeowners who occupied their home. It’s not for real estate speculators, he said.
Maier credits attorney Dave MacDougall of Janesville, Walworth County Clerk of Circuit Court Sheila Reiff, housing credit counselors at Community Action and the Walworth County Bar Association with putting the program into action.
Mediators have no direct power. They attempt to persuade creditors to resolve issues and help clients understand their dilemmas, Maier said.
The program begins with counselors identifying the financial situations of homeowners and seeing whether federal, state or local programs can help.
After that, a proposal is taken to mediation. The homeowner and the lender meet with a mediator, who helps them reach an acceptable settlement.
“The goal is simply to help both the people who live in a home and the lender who holds a defaulted mortgage on that home to work out an agreement that is in the best interests of both sides and that avoids a full court proceeding,” Race said.
“In many cases, mediation leads to people keeping their home under new financial terms, although it sometimes means finding a graceful exit for the homeowner,” Maier said.
“There are no good guys. There are no bad guys. There are only problems to be solved.”
Jan 17, 2011 at 8:33 p.m.
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Many of us buy houses we could still afford on unemployment comp. We also drive older cars and save that money which would've been spent to pretend that we have money to our neighbors and people at stoplights. MOST of the foreclosures are legit. I want to know what the responsible home owners who always pay as agreed get.
Jan 17, 2011 at 1:59 p.m.
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I am very sorry to say that the only thing that will correct the foreclosure mess is the "rule of law". Judges throughout the state have been allowing fraudulent foreclosures to proceed because they make the assumption that "the banks did everything right". "If the borrower didn't pay, what does it matter?" It matters because the foreclosing entity is not a party who could ever issue a "satisfaction of mortgage". The debt collection laws are very specific. The debtor has a right to know who his creditor is (Regulation Z). Wisconsin, as a lien state, requires the security interest (mortgage) to be recorded in the county land records, as has been done for the last 200 years. The servicers are foreclosing on homeowners without proof of the chain of title, contrary to Wisconsin Statute, New York Trust Law (which governs the "pooling and servicing agreements" of the Trust entities, as well as the Securities and Exchange Act of '33-'34). The servicers have no "ownership interest". They are the "collectors of payments". When a "plaintiff trustee bank" files a foreclosure lawsuit and their identity is not listed in the land records, the suit should be dismissed. The judiciary can no longer plead ignorance as other state judiciaries expose the bank and mortgage fraud for what it is. Fraud. Judges are acting in concert with the foreclosure-mill law firms and failing to enforce the rule of law. Behind every fraudulent foreclosure is a predatory loan. Fraudulent affidavits are ignored. "Beauty is in the eye of the beholder...They look fine to me", as one judge said, looking at signatures that were nothing alike.
I will also go as far as to say that the media is complicit with the "Greatest Fraud on Earth". If 80 million homeowner/borrowers wake up to read the paper and it says "Securitized Mortgages Are Really Unsecured!", the too-big-to-fail banksters will, well, FAIL! The media will not tell this story. Therefore, they are complicit.
And then there is law enforcement. Wisconsin Department of Financial Institutions, the Attorney General, the regulators who oversee the appraisers and brokers, these agencies are failing the residents of this state. They answer that "we have no control over the national banks". This is now patently false. "Coumo v. Clearinghouse Association" gives the state the right to enforce their own "state banking laws". There are no more excuses.
This has to stop. Now.
Bristol, WI
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