On August 17, 2012, Law No. 184-2012 was approved. It was called, "Law for Compulsory Mediation and Preservation of your Home in the Foreclosure Processes of a Main Residence".
It is an interventional, non-adjudicative process in which a neutral intervenor (mediator) helps or assists people in conflict to reach an agreement that is mutually acceptable to them to resolve their dispute.
Mediation is a process by which a neutral third party (the mediator) helps the homeowner and lender reach a negotiated, fair, and voluntary agreement. The mediator does not decide who is right or who is wrong.
In cases where a mortgagee may initiate a foreclosure proceeding, or which may culminate in the judicial sale, of a residential property constituting a primary residence, a compulsory mediation meeting shall be held, chaired by a mediator selected by the parties, in the course of summary and/or ordinary foreclosure proceedings.
At this meeting, the mortgagee will notify the mortgagor of all the alternatives available in the market in order to avoid the foreclosure of the mortgage or the judicial sale of a residential property that constitutes a main residence.
The purpose or objective will be to be able to reach an agreement or modification that allows the mortgagor to establish a payment agreement or other satisfactory alternative to the parties and not lose their main home.
The compulsory nature of holding an initial mediation session does not imply that the parties are obliged to reach an agreement as a result of the process.
It is conducted in a room or hall of the Court or in any place that the parties select in agreement with the mediator, but which may not be in the offices of the mortgage creditor, its attorneys, legal representatives or advisors.
The mediation process can be carried out at the Conflict Mediation Centers located in the judicial regions, where the services will be offered free of charge.
Similarly, they can be carried out in a place agreed between the parties, except for the office of the creditor or his/her legal representative, which will be assisted by a private mediator who is in the Certified Private Inspector Registry, which is administered by the Alternative Conflict Resolution Methods Department.
It is made clear that compulsory mediation only covers people who are facing a mortgage foreclosure process or judicial sale of their main residence, who have responded to the lawsuit or court summonses, i.e., who are not in default or have received a legal penalty.
No, you do not have to be represented by an attorney to participate in this program.
If the debtor does not appear at the mediation procedure or if he/she does not comply with the agreement reached with the mortgagee as a result of the mediation process, the financial institution will act in the manner agreed in the contract or promissory note made on the day of the original mortgage transaction.
The debtor shall only be entitled to a mediation procedure in the civil action brought against him/her for the enforcement of the mortgage on the residential property constituting his/her main residence, provided that the defendant mortgagor is not in default, or that for some reason or penalty, his/her allegations have been suppressed or eliminated by the court.
The expenses to be incurred in the mediation process will be paid, unless otherwise agreed, in equal parts.
Yes, any conversation in the mediation session is confidential.
