Financial institution, Foreclosure, Jack McConnell, McConnell, Rhode Island, Settlement (litigation), United States Court of Appeals for the First Circuit, United States federal judge
A couple of weeks ago, a federal judge lifted a blanket order that had prevented over 800 of Rhode Island foreclosures from moving forward and had sent the cases to mediation where both homeowners and financial institutions were required to first engage in settlement discussions.
In a 2011 order, amid America’s housing crisis, U.S. District Judge Jack McConnell instituted an order to halt all foreclosure cases before the court, suspend all deadlines and mandated that all homeowners and financial institutions take part in ‘‘directed and serious settlement discussions’’ before he would allow any foreclosure case to proceed. However, earlier this week, McConnell was forced to lift his injunction on grounds that he failed to follow the proper procedures in his order.
Although the 1st Circuit Court of Appeals demanded that McConnell’s order be lifted, the District Judge still believes it is imperative that both homeowners and financial institutions find solutions without homeowners being threatened with eviction.
‘‘It is in all parties’ and the court’s best interest to have the parties talk to each other in a meaningful way and to attempt to amicably resolve these matters,’’ he wrote.
McConnell asserted he would closely examine a number of individual cases before moving forward with the other 800-plus cases. Additionally, McConnell said he would take meetings with lawyers for both parties to discuss how to continue the mediation program.
Corey Allard, an attorney representing many homeowners suing financial institutions, said his clients are disappointed.
“The banks are going to be allowed to foreclose on our clients. We’re hopeful that the defendants are going to be reasonable and work with our clients towards loan modifications,’’ he said.
At press time three lawyers representing financial institutions were unavailable for comment.
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