DISB Issues Bulletin Offering Guidance on Saving District Homes Against Foreclosure

Washington, DC - November 30, 2010 - (RealEstateRama) -- The DC Department of Insurance, Securities and Banking (DISB) recently issued a bulletin* to inform licensed residential mortgage lenders and mortgage borrowers of the enactment of a new emergency law requiring mortgage lenders to go through six months of mediation with a homeowner before proceeding with a foreclosure.

Washington, DC – November 30, 2010 – (RealEstateRama) — The DC Department of Insurance, Securities and Banking (DISB) recently issued a bulletin* to inform licensed residential mortgage lenders and mortgage borrowers of the enactment of a new emergency law requiring mortgage lenders to go through six months of mediation with a homeowner before proceeding with a foreclosure.

“From the beginning of the foreclosure crisis, DISB has been a vocal proponent of offering mediation and counseling as alternatives to help keep our residents in their homes,” said DISB Commissioner Gennet Purcell, adding that to arm and assist District residents facing foreclosure, the agency currently forwards referrals to District of Columbia housing counselors for one-on-one support and assistance; co-hosts foreclosure prevention seminars; and makes available its Foreclosure Mitigation Kit. “Foreclosure is not always the only option, and oftentimes, the circumstances surrounding a threatened foreclosure dictate that an alternative resolution is a good option for that homeowner. DISB is pleased that the Council enacted this bill as District homeowners need more options when it comes to the threat of foreclosure.”

The bill, which was signed by Mayor Adrian M. Fenty on Nov. 17, 2010, requires lenders to send homeowners a form to opt in or out of mediation when the homeowners receive foreclosure notices from the lenders. If borrowers choose to opt in, they will enter mediation with their lender and have 90 days, in addition to the 30 days they had prior to deciding whether to opt in or out, to work out a deal. Mediation allows the borrower and the lender’s representative to negotiate, with the guidance of foreclosure mediators, impartial go-betweens hired by the agency to preside over mediation sessions geared to facilitate alternatives to foreclosures, such as loan modifications.

DISB will administer the program, set fees and ensure that certificates of mediation are issued to homeowners. The emergency legislation will expire Feb. 15, 2011. The permanent version, Bill 18-691, is pending. At the end of the Bulletin is a list of questions and answers on the implementation of the law.

Any questions regarding the implementation of the new law, please contact DISB Deputy Commissioner Christopher Weaver at (202) 442-7774 or by e-mail at .

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