Beyond Balls and Strikes: Towards a Problem-Solving Ethic in Foreclosure Proceedings

Abstract

Courts across the country are being saddled with a rapid escalation of foreclosure filings due to the fallout from the subprime mortgage crisis. More than two million homeowners stand to lose their home in the United States in the next year, and hundreds of billions of dollars in home equity will be lost by all homeowners as a result, not just those in default on their mortgages. This article assesses the impact of this wave of foreclosures on communities and the courts, and suggests that jurisdictions should adopt the techniques of those problem-solving courts already in existence: i.e., drug courts, mental health courts, community courts and domestic violence courts. These techniques involve active judges in non-traditional roles engaging in systemic reform and close monitoring of litigant conduct while utilizing non-adversarial approaches and enlisting the assistance of interdisciplinary stakeholders. Such techniques are well suited to the foreclosure context, particularly given the nature and scope of the subprime mortgage crisis, and court systems should consider creating specialized foreclosure courts that can adopt a problem-solving approach to address the rapid rise in foreclosure proceedings.

Keywords: foreclosure, subprime, mortgage, problem-solving courts

JEL Classification: H11, K41