The real estate profession has become increasingly based in legalities. While a handshake can signify an agreement, the contract is the foundation of the real estate transaction today.

With the increased focus on legal issues, Nevada REALTORS® provides members services in the legal arena. Various articles on current and hot legal topics are provided through the weekly Nevada REALTORS® eNews. In addition, the Legal Information Line is available to members.

There are many real estate related questions that arise often. These FAQs (Frequently Asked Questions) by topic are provided to assist you in finding quick answers.


Q:  What is the Nevada Foreclosure Mediation Program?

A:  NRS 107.086 (was Assembly Bill 149) was passed during the 2009 legislative session to address the foreclosure crisis and to help keep Nevada families in their homes. The law establishes a Foreclosure Mediation Program for owner-occupied residential properties that are being foreclosed on and have received a Notice of Default and Election to Sell. To qualify for the mediation program, the property must be located in Nevada and be the homeowner’s primary residence.

Q:  What does the Foreclosure Mediation Program do?

A:  The Program provides a forum for the homeowner and the lender on the mortgage to discuss and try to reach a loan modification or an agreement which will assist the homeowner to make his/her payments and assist the lender in getting its loan paid. The Program provides a mediator who facilitates the mediation process.

Q:  Why should a homeowner mediate?

A:  Mediation is a give-and-take process where the homeowner and a representative from the lender negotiate and try to reach a mutually acceptable resolution to the mutual problem. Agreements reached in the mediation process are usually compromises that give advantages to the homeowner and to the lender. Also, mediation is a quicker and more efficient method to meet the lender.

Q:  Does the mediator make an award or decision?

A:  No, the mediator facilitates the parties in exploring various options in hopes they can reach a compromise so that the homeowner can avoid foreclosure and continue living in his/her home and the lender can get paid.

Q:  What happens if the homeowner and the lender do reach a compromise?

A:  At the mediation, the mediator prepares a Statement of Agreement and has both parties sign it. The mediator then, within 10 days of reaching the Agreement, files the Agreement with the Foreclosure Mediation Program Administrator and the mediation will be closed. The parties then abide by the Agreement.

Q:  What happens if the homeowner and the lender do not reach a compromise?

A:  Within 10 days of the mediation, the mediator will prepare the necessary Non-agreement form and serve it on the parities. The original will be filed with the Foreclosure Mediation Program Administration.

Q:  How much does mediation cost?

A:  Other than the filing fee paid by the lender, the cost of mediation is $400, shared equally by the homeowner and the lender. Each party must pay their $200 portion prior to the mediation date. and the Mediation will be closed. If there is no agreement, the parties will be free to pursue other legal remedies.

Q:  What does a lender look for in order to do a loan modification during the mediation?

A:  Generally, the lender wants to examine the homeowner’s financial status to be sure that the homeowner can make payments if the home loan is modified. My observations have been that if the homeowner has the ability to make payments of at least 31% of his/her gross monthly income, the lender will lower the interest rate so that the payments will reach 31% of the homeowner’s gross monthly income.