Civil Rights & Mediation Clinic Supporting Mortgage Loan Foreclosure Mediation in St. Louis City
The law school’s Civil Rights & Mediation Clinic’s work on foreclosure mediation now extends to St. Louis City, where clinic students and faculty hope the measure will face smooth sailing.
The St. Louis Board of Aldermen passed an ordinance providing for mortgage loan foreclosure mediation earlier this month. St. Louis County approved a similar ordinance last September, but the measure has faced a series of challenges. Several clinic students have worked on various aspects of both ordinances, which require banks to participate in a formal mediation before foreclosing on residents if the homeowner opts for mediation.
Karen Tokarz, the Charles Nagel Professor of Public Interest Law & Public Service and director of the Civil Rights & Mediation Clinic, notes that clinic students have been providing assistance to US Arbitration & Mediation (USAM) and other organizations in the implementation of the St. Louis County program and the development of the new St. Louis City program.
“While foreclosures are down across the country, they are up in Missouri,” notes Tokarz, who also directs the school’s Negotiation and Dispute Resolution Program. “Mediation is a strong alternative and proactively addresses the problem. We are pleased to see St. Louis City take positive steps in this direction, and are grateful for the opportunity for our students to gain practical experience in mediation while helping the community address a crucial need.”
This semester, second-year law students Colleen Davis, Craig Fitch, and James Maerder have been counseling homeowners and participating in actual foreclosure mediations at USAM. Other clinic students have talked with stakeholders, attended legislative hearings, and observed court hearings.
“Working with the people at our clinic partners, Beyond Housing and the Equal Housing Opportunity Council, and the mediators at USAM has been a great experience,” Fitch says. “It has been enlightening to work side-by-side with homeowners who are facing foreclosure, regardless of how they got in that situation, and discuss the different loss mitigation options available to them. It has also been a great experience to attend mediations where homeowners and lenders are present, opening the lines of communication and discussing possible options that are beneficial to both parties.”
Fitch adds that his work with the clinic builds on his Bankruptcy, Real Estate Transactions, and Mediation courses. “The opportunity to work at Beyond Housing and attend mediations at USAM has been fantastic practical application of the principles I learned in the classroom,” he adds. “I’ve been able to see how these principles apply in real-life situations.”
In the meantime, lenders are now engaging in mediations in St. Louis County only on a voluntary basis. Having survived a challenge in St. Louis County Circuit Court, the county’s ordinance went into effect on November 15, 2012. However, on January 18, 2013, further implementation was stayed by the Missouri Court of Appeals, pending argument on the appeal set for April 3. View related story on the clinic’s work here.
The numbers demonstrate the extent of the problem in both the city and county, Tokarz notes. According to the St. Louis County Recorder of Deeds Office, there were 4,183 foreclosures in the county in 2012, up from 3,849 in 2011. The county has experienced approximately 4,000 foreclosures a year for the past six years, while the city has experienced more than 1,000 foreclosures each year for the past 10 years. The Federal Reserve Bank of St. Louis reports that 7 of the top 10 ZIP codes on Missouri’s list of mortgages under stress—those with 10-15 percent of mortgage loans seriously delinquent—are in north St. Louis, with five in north St. Louis County and two in north St. Louis City.