Madigan announces $5M grant for foreclosure mediation programs
general distributes funds from national foreclosure settlement over
banks' illegal 'robo-signing,' servicing practices
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[April 27, 2013]
CHICAGO -- Attorney General Lisa
Madigan awarded $5 million in grants on Thursday from the national
foreclosure settlement to fund the creation and implementation of
new mortgage foreclosure mediation programs in counties with
significant needs but without current programs.
The funding comes from Madigan's role in securing a $25 billion
national settlement with the nation's five largest bank mortgage
servicers -- Bank of America, JP Morgan Chase, Wells Fargo, Citibank
and Ally Bank, formerly known as GMAC. The settlement addressed
allegations of widespread "robo-signing" of foreclosure documents
and other fraudulent practices while servicing loans of struggling
"The goal of a foreclosure mediation program is to
connect homeowners in crisis with legal assistance and housing
counseling services so they can accurately assess their options and
pursue the best plan," Madigan said. "Because mediation has been
proven to give homeowners a greater chance to save their homes,
these grant funds will help both families and communities that have
been devastated by the foreclosure crisis."
The $5 million from the settlement will fund three regional
projects to assist with the startup of foreclosure mediation
programs in the following judicial circuits where the judges are
interested in pursuing a program: 1st, 2nd, 5th, 6th, 7th, 16th,
17th, 19th, 20th and 21st. In each judicial circuit, the projects
will initially focus on the counties with the highest number of
foreclosure cases and will begin by working closely with the
In the northern region of the state, Northern Illinois University
Law School and nonprofit Resolution Systems Institute will partner
to develop mediation programs. In central Illinois, the University
of Illinois College of Law will work to develop and administer
mediation programs in surrounding counties. And, in southern
Illinois, Dispute Resolution Institute, a Carbondale-based nonprofit
mediation program coordinator, will assist the courts with the
startup of mediation programs.
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The three regional projects will
Work with judges
to develop rules and documents the judicial circuit needs to
implement a mediation program.
Recruit and train
Work with housing
counselors and legal aid attorneys to assist homeowners who
participate in the foreclosure mediation programs.
Develop an online
monitoring system to permit the mediation programs to input data
for tracking and evaluation.
Evaluate and report outcomes and
efficiency of the mediation programs and develop ways to improve
the programs when needed.
As part of the national foreclosure settlement, Madigan's office
recovered money from the banks to remediate the historic levels of
foreclosures in Illinois. The announcement this week is part of an
ongoing plan to distribute the settlement funds to legal assistance
programs, housing counseling services and community revitalization
programs in an effort to counteract the impact of foreclosures on
communities throughout Illinois.
Madigan has already distributed $20 million for legal aid
services for homeowners and renters in distress. In addition, she
has solicited proposals for $70 million in settlement funding to be
used toward housing counseling and community redevelopment projects.
A review of those proposals is ongoing.
[Text from file received from the office
Illinois Attorney General Lisa