"The Nevada Supreme Court altered the foreclosure mediation landscape in dramatic fashion earlier this month when, in two separate cases, justices made it clear lenders must follow two simple rules -- bring all relevant documents to the table and make sure someone with loan modification authorization is readily available.
A homeowner's lawyer in one of those cases, Terry Thomas of Reno, plans to test the waters Monday by asking Washoe County District Judge Patrick Flanagan to impose a $1 million fine against a banker who a mediator found acted in bad faith.
"Lenders were saying the rules were not really mandatory," said Thomas, who represents about a dozen homeowners facing foreclosure in the Reno area.
Now, lenders have been forewarned that the rules are not optional, and the two Nevada judges who review failed mediations have been put on notice that they must sanction lenders who fail to strictly comply with those rules.
Thomas will suggest the money go to a charity such as the Salvation Army or Red Cross, but for lenders the point would be made: Negotiate in good faith or pay a high price.
THE BANKS' PERSPECTIVE
Bill Uffelman, president of the Nevada Bankers Association, said lenders believe the rules lean too far in favor of borrowers who might have a bad loan but nonetheless signed a contract to repay"..............READ MORE
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