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IBA: Mortgage Foreclosure in Marion County

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By The Hon. Cynthia Ayers

In November 2008, the Indianapolis Bar Association Board of Directors approved a resolution authorizing the formation of a new task force charged with finding ways to confront the explosion in mortgage foreclosures in Marion County. The Indianapolis Mortgage Foreclosure Task Force (IMFTF) was established, comprised of volunteer lawyers, judges, and state agency managers. Members included lawyers from the Indiana Bankers Association, the Attorney General’s Office, Legal Services Organization, United Auto Workers Legal Services, the Indiana Mortgage Foreclosure Prevention Network, the Christian Legal Clinic, HUD, debt management agencies, members of the private bar and other concerned citizens.

The initial responsibility of the IMFTF was to determine the magnitude of the mortgage foreclosure crisis and develop an appropriate action plan. The committee developed ideas on how the bar association might help distressed homeowners and lenders and the entire community as a whole. Members quickly realized that in addition to families facing personal financial crisis, banks were being inundated with foreclosed properties. Empty homes were often magnets for criminal activity and consequently, directly related to rapidly falling home values.

Subcommittees were set up to facilitate a diversified approach to critical issues. Three major objectives were identified: court case-management, with the use of Alternate Dispute Resolution methods to promote face-to-face meetings between borrowers and lenders; education and training of lawyers, to facilitate pro bono representation of homeowners; and collaboration with the Indiana Housing Foreclosure Network, to encourage the referral of borrowers to credit counseling and debt management services.

For years, the Indiana foreclosure process followed a general routine. Initially, the lender filed suit after payments were missed, service was obtained on the defendant homeowner, the appropriate pleadings were presented timely to the court, and if done properly, default judgment was entered. Next, the defaulted borrowers either voluntarily left or stayed in possession until evicted after a Sheriff’s Sale. As the economic crisis worsened nationwide, it became increasingly apparent that an opportunity for settlement discussions may be a better approach for all parties. Based upon success in Pennsylvania, Ohio, Connecticut, and Illinois, the IMFTF drafted a local rule, later approved by the Marion Superior Court in March 2009. The local rule required a settlement conference between borrower and lender in owner-occupied foreclosure cases.

Concurrently, the federal government required banks to offer loan modification programs to eligible borrowers. In July 2009, SB492, modeled in large part after the aforementioned Marion County local rule and sponsored by Senator Karen Tallian of Portage, Indiana, was enacted. (I.C. 32-30-10.5 et seq.). SB492 made settlement conferences available to all homeowners who requested them within certain timelines.

Since the passage of the local rule and SB492, much progress has been made. In Marion Civil Court IV, for example, 197 settlement conferences have occurred; of those, 27% resulted in dismissal of the foreclosure action and 15% are pending with proposed settlements.

In early 2010, the Indiana Supreme Court introduced pilot projects in Marion, Allen, Monroe, and St. Joseph counties which provide logistical coordinators and facilitators who manage the settlement conferences. In Marion County, three courts are part of the pilot program: Circuit Court and Civil Courts IV and X. This program has streamlined the foreclosure process, proving highly beneficial to successful outcomes. In-person facilitation has insured good faith settlement negotiation between borrower and lender.

In addition to these measures, other members of the IMFTF were educating and training volunteer attorneys to represent borrowers pro bono. To date, over 1000 attorneys statewide have received foreclosure training. Members involved with foreclosure prevention at the state level have also continued to work by keeping the crisis statistics current, providing access to twenty-four hour debt counseling services, and affording relief to homeowners through the “Get Hope Get Help Hotline,” (1-800-382-5516).

In sum, the Indianapolis Mortgage Foreclosure Task Force has met many of its goals and continues to move forward. Improvements are needed to encourage and expedite case resolution, such as the linking of homeowners directly to a legal-advice hotline. A better process for the exchange of information between debt counselors and case facilitators may reduce duplicative efforts. Additionally, the establishment of a confidential E-Repository for all settlement-related documents could eliminate cancelled meetings.

The Indianapolis Bar Association can be proud of the accomplishments of the Mortgage ForeclosureTask Force. Desperate times have called for a much needed change in mortgage foreclosure case management and local lawyers and judges have answered the call.•

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  1. I have been on this program while on parole from 2011-2013. No person should be forced mentally to share private details of their personal life with total strangers. Also giving permission for a mental therapist to report to your parole agent that your not participating in group therapy because you don't have the financial mean to be in the group therapy. I was personally singled out and sent back three times for not having money and also sent back within the six month when you aren't to be sent according to state law. I will work to het this INSOMM's removed from this state. I also had twelve or thirteen parole agents with a fifteen month period. Thanks for your time.

  2. Our nation produces very few jurists of the caliber of Justice DOUGLAS and his peers these days. Here is that great civil libertarian, who recognized government as both a blessing and, when corrupted by ideological interests, a curse: "Once the investigator has only the conscience of government as a guide, the conscience can become ‘ravenous,’ as Cromwell, bent on destroying Thomas More, said in Bolt, A Man For All Seasons (1960), p. 120. The First Amendment mirrors many episodes where men, harried and harassed by government, sought refuge in their conscience, as these lines of Thomas More show: ‘MORE: And when we stand before God, and you are sent to Paradise for doing according to your conscience, *575 and I am damned for not doing according to mine, will you come with me, for fellowship? ‘CRANMER: So those of us whose names are there are damned, Sir Thomas? ‘MORE: I don't know, Your Grace. I have no window to look into another man's conscience. I condemn no one. ‘CRANMER: Then the matter is capable of question? ‘MORE: Certainly. ‘CRANMER: But that you owe obedience to your King is not capable of question. So weigh a doubt against a certainty—and sign. ‘MORE: Some men think the Earth is round, others think it flat; it is a matter capable of question. But if it is flat, will the King's command make it round? And if it is round, will the King's command flatten it? No, I will not sign.’ Id., pp. 132—133. DOUGLAS THEN WROTE: Where government is the Big Brother,11 privacy gives way to surveillance. **909 But our commitment is otherwise. *576 By the First Amendment we have staked our security on freedom to promote a multiplicity of ideas, to associate at will with kindred spirits, and to defy governmental intrusion into these precincts" Gibson v. Florida Legislative Investigation Comm., 372 U.S. 539, 574-76, 83 S. Ct. 889, 908-09, 9 L. Ed. 2d 929 (1963) Mr. Justice DOUGLAS, concurring. I write: Happy Memorial Day to all -- God please bless our fallen who lived and died to preserve constitutional governance in our wonderful series of Republics. And God open the eyes of those government officials who denounce the constitutions of these Republics by arbitrary actions arising out capricious motives.

  3. From back in the day before secularism got a stranglehold on Hoosier jurists comes this great excerpt via Indiana federal court judge Allan Sharp, dedicated to those many Indiana government attorneys (with whom I have dealt) who count the law as a mere tool, an optional tool that is not to be used when political correctness compels a more acceptable result than merely following the path that the law directs: ALLEN SHARP, District Judge. I. In a scene following a visit by Henry VIII to the home of Sir Thomas More, playwriter Robert Bolt puts the following words into the mouths of his characters: Margaret: Father, that man's bad. MORE: There is no law against that. ROPER: There is! God's law! MORE: Then God can arrest him. ROPER: Sophistication upon sophistication! MORE: No, sheer simplicity. The law, Roper, the law. I know what's legal not what's right. And I'll stick to what's legal. ROPER: Then you set man's law above God's! MORE: No, far below; but let me draw your attention to a fact I'm not God. The currents and eddies of right and wrong, which you find such plain sailing, I can't navigate. I'm no voyager. But in the thickets of law, oh, there I'm a forester. I doubt if there's a man alive who could follow me there, thank God... ALICE: (Exasperated, pointing after Rich) While you talk, he's gone! MORE: And go he should, if he was the Devil himself, until he broke the law! ROPER: So now you'd give the Devil benefit of law! MORE: Yes. What would you do? Cut a great road through the law to get after the Devil? ROPER: I'd cut down every law in England to do that! MORE: (Roused and excited) Oh? (Advances on Roper) And when the last law was down, and the Devil turned round on you where would you hide, Roper, the laws being flat? (He leaves *1257 him) This country's planted thick with laws from coast to coast man's laws, not God's and if you cut them down and you're just the man to do it d'you really think you would stand upright in the winds that would blow then? (Quietly) Yes, I'd give the Devil benefit of law, for my own safety's sake. ROPER: I have long suspected this; this is the golden calf; the law's your god. MORE: (Wearily) Oh, Roper, you're a fool, God's my god... (Rather bitterly) But I find him rather too (Very bitterly) subtle... I don't know where he is nor what he wants. ROPER: My God wants service, to the end and unremitting; nothing else! MORE: (Dryly) Are you sure that's God! He sounds like Moloch. But indeed it may be God And whoever hunts for me, Roper, God or Devil, will find me hiding in the thickets of the law! And I'll hide my daughter with me! Not hoist her up the mainmast of your seagoing principles! They put about too nimbly! (Exit More. They all look after him). Pgs. 65-67, A MAN FOR ALL SEASONS A Play in Two Acts, Robert Bolt, Random House, New York, 1960. Linley E. Pearson, Atty. Gen. of Indiana, Indianapolis, for defendants. Childs v. Duckworth, 509 F. Supp. 1254, 1256 (N.D. Ind. 1981) aff'd, 705 F.2d 915 (7th Cir. 1983)

  4. "Meanwhile small- and mid-size firms are getting squeezed and likely will not survive unless they become a boutique firm." I've been a business attorney in small, and now mid-size firm for over 30 years, and for over 30 years legal consultants have been preaching this exact same mantra of impending doom for small and mid-sized firms -- verbatim. This claim apparently helps them gin up merger opportunities from smaller firms who become convinced that they need to become larger overnight. The claim that large corporations are interested in cost-saving and efficiency has likewise been preached for decades, and is likewise bunk. If large corporations had any real interest in saving money they wouldn't use large law firms whose rates are substantially higher than those of high-quality mid-sized firms.

  5. The family is the foundation of all human government. That is the Grand Design. Modern governments throw off this Design and make bureaucratic war against the family, as does Hollywood and cultural elitists such as third wave feminists. Since WWII we have been on a ship of fools that way, with both the elite and government and their social engineering hacks relentlessly attacking the very foundation of social order. And their success? See it in the streets of Fergusson, on the food stamp doles (mostly broken families)and in the above article. Reject the Grand Design for true social function, enter the Glorious State to manage social dysfunction. Our Brave New World will be a prison camp, and we will welcome it as the only way to manage given the anarchy without it.

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