Just last night, President Obama, in his State of the Union Address, suggested that some of the nation’s largest financial institutions who took bailout money should start to pay back the American people their “deficit of trust.” Perhaps banks and mortgage lenders agreeing, as a matter of policy, to participate in mediation proceedings before moving forward with foreclosure could help begin to cover this gap.

Coincidentally, the Department of Justice issued a report last week entitled Foreclosure Mediation: Emerging Research and Evaluation Practices. Out of this report come several recommendations for federal action.  Common among most of these recommendations is the notion that the federal government needs to support regional, community efforts to help both distressed homeowners and banks mitigate losses and achieve relatively positive outcomes through mediation.

Of course, this all sounds very nice and fluffy in theory, but for this sort of sweeping incentive program to have any real consequences, banks will have to either agree come to the mediation table or, more probably, be forced to. Congress shouldn’t have to pass law requiring mandatory mediation proceedings before a home can be foreclosed on. Foreclosure is a lose-lose situation for all involved, after all. Mitigating losses should, in theory, be the sole objective of homeowners and banks involved in these unfortunate circumstances. As the federal government continues to research the effectiveness of already-established foreclosure mediation clinics, the data will hopefully bear the benefits these proceedings confer on both parties: mitigated financial losses for the banks and the avoidance of potential homelessness for the homeowners.

Getting banks to agree to come to the table is a major threshold issue that can’t be overlooked. Let’s hope that the DOJ’s continued research in this area firmly establishes that mediation does, in fact, best serve the interests of all parties involved.

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In his interview, Hendrix addresses unique markets that Atlanta could attract, ways to take advantage of our strong state and regional legal infrastructure, and steps the Atlanta legal community needs to take to bring this initiative to fruition.

View Hendrix (below) introduce the initiative at the Metro Atlanta Chamber:

Stay tuned for updates and please feel free to contact me with information regarding the initiative.

For example, a link was posted today about how mediation helped a family avoid losing their home through foreclosure. From my personal work observations, I don’t understand why this isn’t a required procedure in all foreclosure proceedings.

Check out the story here: Young Solo Helps Family Avoid Foreclosure Through Mediation.

And be sure to follow the Georgia Mediators Network on facebook!

The center would be a boon for Atlanta’s legal industry, attracting international companies likely to seek local counsel.

With a center that would provide a substantial boost to the economy, create jobs, and strengthen Atlanta’s international profile, the Georgia legal community, including our state legislators, should work diligently to promote Atlanta as the ideal candidate for the world’s next big arbitral forum.

David Markiewicz, Arbitration Center for Metro Area Proposed, The Atlanta Journal-Constitution, April 14, 2011, at 17A.