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Nevada’s Supreme Court Sides with Homeowners in Foreclosure Cases

""Nevada's Supreme Court"":http://www.nevadajudiciary.us/ sided with homeowners on three foreclosure cases last week regarding violations of the state's ""Foreclosure Mediation Program"":http://www.nevadajudiciary.us/index.php/foreclosuremediation and ""Foreclosure Mediation Rules."":http://www.nevadajudiciary.us/images/foreclosure/adkt435_amendedrules.pdf


The three cases involved accusations that servicers failed to provide required documentation at mediation or did not have someone present at mediation who had authority to modify the loan.

Because Nevada's Foreclosure Mediation Rules ""expressly require that certain documents be produced during foreclosure mediation and that someone with authority to modify the loan must be present or accessible during the mediation, [the court] conclude[d] that a party's failure to comply with these requirements is an offense subject to sanctions by the district court,"" the Court stated.

After reviewing a case involving ""HSBC Bank USA,"":http://www.us.hsbc.com/1/2/3/personal?home=personal&code=PPG0011108&WT.srch=1&WT.mc_id=HBUS_PPG0011108 ""Power Default Services Trustee,"":http://www.defaultservicesinc.com/View.aspx?m=Public&mp=Evictions&a=View&AspxAutoDetectCookieSupport=1 and ""American Home Mortgage Servicing Inc.,"":https://www.ahmsi3.com/servicing/home.asp the Court decided that the servicer did not provide required documentation and did not have someone present at the mediation with authority to modify the loan.

In a second case involving ""Wells Farge,"":https://www.wellsfargo.com/ the Court cited its previous ruling in the Pasillas v. HSBC Bank USA that failure to produce required documents prohibits the district court from certifying the mediation so that foreclosure proceedings may continue.

The Court further noted that this is a sanctionable offense.

The Court concluded that Wells Fargo failed to produce all necessary documents. The court, however, did not agree with the homeowner's accusation that Wells Fargo acted in bad faith.

In a third foreclosure appeal, homeowners requested sanctions be taken against their servicer, HomEq. Servicing Inc on the grounds that the bank's representative at mediation did not have authority to negotiate the loan and that the bank ""acted in bad faith by refusing to consider the Redmons for a loan-modification program.""

Nevada's Supreme Court sent the case back to the district court for review.

Nevada's Foreclosure Mediation Rules were enacted July 31, 2009 and were amended September 28, 2009.

About Author: Krista Franks Brock

Krista Franks Brock is a professional writer and editor who has covered the mortgage banking and default servicing sectors since 2011. Previously, she served as managing editor of DS News and Southern Distinction, a regional lifestyle publication. Her work has appeared in a variety of print and online publications, including Consumers Digest, Dallas Style and Design, DS News and DSNews.com, MReport and theMReport.com. She holds degrees in journalism and art from the University of Georgia.

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