Indiana's Foreclosure Mediation Program

If you face foreclosure in Indiana, you have a right to participate in a foreclosure prevention settlement conference with your mortgage lender.

Many states have mediation programs to assist borrowers in finding ways to avoid foreclosure. Indiana has a program where borrowers may request a "settlement conference" with their lender.

Read on to learn more about how Indiana’s mediation program works and how you can benefit from the process.

What is a Foreclosure Settlement Conference?

A foreclosure settlement conference is a meeting between the borrower and the lender’s representative. At the settlement conference, the parties discuss the borrower's financial situation and try to negotiate a way for the borrower to keep the home or give up the property without going through a foreclosure. By working together, the parties are often able to reach an agreement.

Potential outcomes of a settlement conference include:

Eligibility for a Settlement Conference

Most residential homeowners in Indiana are eligible for a settlement conference, however you're not eligible if:

  • the property being foreclosed isn't your primary residence
  • you had a prior foreclosure prevention agreement (like a loan modification) and you defaulted with respect to the terms of that agreement, or
  • bankruptcy law prohibits the lender from participating in a settlement conference.

Indiana Foreclosures and Settlement Conferences

Indiana foreclosures are judicial, which means the lender must foreclose through the state court system. The lender initiates the foreclosure by filing a complaint and having it served on the borrower, along with a summons to appear in court. (To get a detailed description about the foreclosure process in Indiana, see Indiana Foreclosure Laws and Procedures.)

On the first page of the foreclosure summons, the lender must provide a notice to the borrower about the right to participate in a settlement conference.

How to Participate in a Settlement Conference

The borrowers must notify the court no later than 30 days after the complaint and summons are served if they wish to participate in a settlement conference.

To request a conference, the borrower can:

  • fill out the provided form and return it to the court at the address shown in the summons
  • call the court and request a settlement conference (call the phone number shown in the summons), or
  • appear at the court and make an in-person request for a settlement conference.

Notice of Settlement Conference

If the borrowers contact the court indicating they would like to schedule a settlement conference, the court will then issue a notice of a settlement conference.

The notice will order the lender and the borrowers to conduct a settlement conference on or before a date and time specified in the notice for the purpose of attempting to negotiate a foreclosure prevention agreement.

Attendees at the Settlement Conference

An attorney for the lender must attend the settlement conference, and an authorized representative of the lender must be available by telephone.

The borrowers have the right to be represented by an attorney or assisted by a mortgage foreclosure counselor in person or by telephone. (To learn about getting free help from a foreclosure counselor, see Foreclosure Prevention Program in Indiana).

After the Settlement Conference

The next steps depend on whether you come to an agreement with the lender, or not.

What happens when an agreement is reached? If the lender and the borrowers agree to enter into a foreclosure prevention agreement, the agreement must be put in writing and signed by both parties, with each party retaining a copy. The lender must also file a copy of the signed agreement with the court.

The foreclosure will then be dismissed or postponed so long as the borrowers comply with the terms of the foreclosure prevention agreement.

What happens if an agreement isn't made? If the lender and the borrowers are unable reach an agreement, the lender must file a notice with the court indicating:

  • that the settlement conference was held and a foreclosure prevention agreement was not reached, and
  • that the foreclosure action may proceed (though this is subject to the court's right to order the lender and borrowers to reconvene a settlement conference at any time before judgment is entered).

Should You Participate in a Foreclosure Prevention Settlement Conference?

Even though participating in a settlement conference doesn't guarantee that a foreclosure will be avoided, it doesn't hurt to go to the conference. The lender may be more likely to agree to a nonforeclosure solution at a settlement conference than if you approach it outside of the program. Or you might qualify for a loss mitigation option that you hadn’t previously considered.

For more information on foreclosure prevention in Indiana, including settlement conferences, go to the Indiana Judicial Branch's "Help with Mortgage Foreclosures" website.

Talk to an Attorney

If you want to learn about potential defenses to foreclosure or want a lawyer to represent you at the settlement conference, talk to a foreclosure attorney. If you can't afford an attorney, you might qualify for free legal assistance from one of Indiana's pro bono programs. To find out about free legal assistance in Indiana, go to the "Can I Get An Attorney?" section of the Indiana Judicial Branch's "Help with Mortgage Foreclosures" website.

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