Foreclosure Mediation Programs Succeed Across The Country — Will Pawlenty Give Minnesota’s A Chance?
Today, across the country, mortgage mediation programs aimed at helping struggling homeowners stay in their homes are getting underway. Programs are launching in Maryland, as well as Florida’s 6th and 10th judicial circuits — encompassing Pasco, Pinellas, Hardee, Highlands, and Polk counties — while Cook County, Illinois is beginning a huge round of outreach for its burgeoning program.
In all, “the number of jurisdictions with foreclosure mediation programs is nearly double the number a year ago, with jurisdictions in 21 states now offering foreclosure mediation or negotiation programs.” Not on this list, however, is Minnesota, where Gov. Tim Pawlenty (R) saw fit to veto a program last year.
The Minnesota state senate recently passed the bill again, sending it to the state House, so Pawlenty could very well get a second shot soon. And there’s simply no reason for him to oppose the program, as mediation — during which a bank meets face-to-face with a borrower, often in the presence of a judge and housing advocates, to try and forge a mortgage modification or other arrangement that prevents a foreclosure — is one of the most successful methods of helping struggling borrowers stay in their homes.
Connecticut’s mediation program, for instance, has kept 60 percent of its borrowers out of foreclosure. Philadelphia’s success rate is also 60 percent, while Nevada claims an 85 percent success rate:
About 80 percent of homeowners at risk of losing their homes don’t engage in any efforts to negotiate with their lender. And those who do so on their own often run into a bureaucratic mess, including hours on hold, lost records, and customer service representatives who know nothing about the borrower’s situation. Mediation helps to ensure that situations like that don’t happen.
“These new protections empower our fellow Marylanders, putting them on a more equal footing with mortgage companies that too often can’t be bothered to pick up the phone before beginning a foreclosure proceeding against a Maryland family,” said Governor Martin O’Malley (D). And lest Pawlenty think this is a purely partisan issue, it has also won the praise of Gov. Jodi Rell (R-CT). “Clearly, mediation is an effective tool homeowners can use to ward off foreclosure,” she said. “This program is a beacon of hope for hard-pressed homeowners and a real alternative for lenders.”
In mediation, there’s no requirement for a lender to accommodate a borrower, but it’s often the case that preventing a foreclosure is in the best financial interest of both the borrower and the lender. As CAP’s Andrew Jakabovics and Alon Cohen wrote, “the simple act of participating in mediation consistently yields solutions short of foreclosure that are acceptable to both sides.” Hopefully, should the Minnesota legislature do the right thing and create a program, Pawlenty will allow it to stand.
That's so this year. What's that? Silly Bandz? Twilight? As Mark Cuban writes on his blog, "Location check in is so 2010." Cuban explains that he just invested in a company that, through video footage, determines how many people are in a given area at a time, ostensibly for security and traffic-pattern analysis. For now anonymity is given to crowd members, but Cuban wonders if adding facial recognition software would allow locations to forego checkin applications because "we would already know you are there." Sound a little like Minority Report? TechCrunch thinks so. "It sounds like a future we're inevitably headed toward."
Behind the scenes at Gilt Groupe. In an interview with the Wall Street Journal, Alexis Maybank shares the story of how she and co-founder Alexandra Wilkis Wilson built Gilt Groupe, the online flash sales site for men's and women's luxury fashions. The company, founded in 2007, reported $170 million in revenue last year and now boasts three million members who shop for designer brands at up to 70 percent off retail prices. Maybank talks about the challenges of getting the word out there, signing up initial designers, and raising VC as a woman. She explains to the Journal that "it's an old boy's network, and that's intimidating for a lot of women. So when explaining fashion to a bunch of men in khaki pants and blue button-down shirts, their response was always 'Oh, let me see if my wife thinks if this is a good idea.' But it worked."
Our annual 30 Under 30 list. They're running innovative companies, they're building communities, they're setting trends, they're giving back--and they're all under 30. Here's this year's winners, from Sprouter, to Agile Sports, to The Man Registry. Did we miss anyone? Let us know in the comments.
Foursquare is prowling for a partnership. Yet another 30 Under 30 winner is making headlines this morning as it attempts to snag a whale of a partnership. Foursquare, the game/ social network that recently raised $20 million in Series B funding, claims it is in talks with Google, Yahoo and Microsoft about deals involving their location-based data (via GigaOM). While the novelty of being the mayor of your local mall might gradually wear off it can still be a useful tool to make money for your business. Also, this type of partnership is what catapulted Twitter to profitability.
Facebook's co-founder on the Facebook movie. When you're trying to revolutionize social networking while you're still at Harvard, you're probably not thinking about how Aaron Sorkin might portray your life in a feature film six years hence. In SocialBeat, Facebook co-founder Dustin Moskovitz, gives his take on the silver screen adaptation. In short: it overplays the sex and booze. "It is interesting to see my past rewritten in a way that emphasizes things that didn't matter . . Other than that, it's just cool to see a dramatization of history. A lot of exciting things happened in 2004, but mostly we just worked a lot and stressed out about things; the version in the trailer seems a lot more exciting, so I'm just going to chose to remember that we drank ourselves silly and had a lot of sex with coeds," writes Moskovitz, who is currently working on a productivity startup Asana, backed by Benchmark Capital and Andreessen Horowitz. As for Zuckerberg, he adds, "At the end of the day, they cannot help but portray him as the driven, forward-thinking genius that he is."
What financial reform means for angel investing. In a guest post at VentureBeat, Scott Walker, CEO of a law firm that specializes in entrepreneur representation, breaks down the impact of the financial regulation bill on angel investing. The verdict: it's a mix of good and bad.
Renting a room to save a home. Today's BusinessWeek explains how San Francisco-based startup AirBnB is helping homeowners escape foreclosure. The site allows people from 142 countries to rent out empty rooms and pull in a little extra income. One New Yorker tells BusinessWeek, "This has been our stimulus package...we were going to lose our house." Founders Brian Chesky and Joe Gebbia say they got the idea for the company when they were cash-strapped, themselves. After renting out space in their own home, they decided to turn the idea into a business, enlisting the help of their friend Nathan Blecharczyk. All three founders made it onto our 30 under 30 list this year, having seen a tremendous amount of growth since the site launched just two years ago.
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