Worried about foreclosure? What you should know about the CT Foreclosure Mediation Program.
If you're struggling to make your mortgage payments, there is a State of CT program to assist homeowners who want to work out an alternative to foreclosure. It is free and it provides valuable information for those facing an uncertain situation. Do not miss the opportunity to participate in this program. In my experience working with distressed homeowners I find it is one of the best resources out there. Here's what you need to know:
If you've missed payments, you'll eventually be sued by the bank for not fulfilling the terms of your mortgage contract. You will be notified of the lawsuit via a notice from the court. The notice will include a form to determine if you are eligible to participate in the program. Participation is optional, so you must fill out the paperwork to be eligible.
The paperwork is simple to fill out. The foreclosure mediation form contains 4 questions:
1) Are you the borrower? 
2) Is the home a 1-4 family home in the State of CT?
3) Is it your primary residence?
4) Is this a mortgage foreclosure?
All 4 criteria must apply to be eligible. The form must be filed at your local courthouse clerk's office with an appearance form. Copies of the two forms must be mailed to the bank's attorney, whose name is listed on the notice.
You do not need an attorney to participate in the program. You may hire an attorney to represent you if you wish, but it is not required for the program.
The court will schedule a session where the homeowner, the mediator, and the bank's attorney will discuss your situation. The bank does not want to take your house. The purpose of the mediation is to negotiate a solution to the problem of late payments that works for the lender and the borrower. Some of the options the bank may be able to offer struggling homeowners include:
- Forbearance plans - a temporary hiatus from payments
- Loan modifications - lowering the monthly payments on the loan
- Deed in lieu of foreclosure - turning over the deed of the house to the bank
- Sale of the home or short sale - sell the house to be able to pay back the loan, or when the loan amount is greater than the net proceeds of sale, a request to release the mortgage lien for less than the amount owe
Participation in the program is free. The State of CT foreclosure mediation program is an effective resource to struggling homeowners who want to avoid foreclosure.
For additional questions about the program visit the State of CT Judicial Branch website
Additional details on solutions for struggling homeowners in Danbury/Brookfield/New Milford CT are available here.
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