The Viability Of Loss Mitigation Programs

Law360, New York (February 10, 2011, 12:43 PM EST) -- A pair of Jan. 28 decisions — In re Sosa and In re Lawton — from the U.S. Bankruptcy Court for the District of Rhode Island confirmed the court’s authority to compel debtors and residential mortgage lenders to participate in a loss mitigation pilot program designed to “encourage the resolution of differences between residential mortgage lenders and their borrowers” through good faith negotiation.[1]

In each case, the debtor’s residential mortgage lender objected to the debtor’s request for loss mitigation on the basis that the court lacked...
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