Foreclosure Diversion Program

The Foreclosure Diversion Program (FDP) in the Maine courts gives lenders and homeowners in foreclosure a chance to explore other options and work out their differences.  In mediation both parties, with the help of a neutral mediator, talk about whether it is possible to avoid a foreclosure on the property.  Some other options include a loan modification or short sale. 

To participate in mediation, a homeowner must live in the home, and the property must have no more than four (4) units.  When a qualified homeowner in foreclosure requests mediation, the case enters the FDP.  Homeowners attend an Informational Session, where a judge explains the court process and a housing counselor or legal services attorney explains more about working with lenders to modify loans.  The homeowner attends the first mediation session on the same day. 

At mediation, homeowners and their attorneys (if they are represented) meet with the lender and the lender’s attorney.  A mediator is present to help the parties to make sure that everyone is heard and that important issues are discussed.  The mediator submits a report about the mediation to the court.  Sometimes parties return at a later date for another mediation session.

How Do I...?

  • How Do I ask for mediation?
    All requests for mediation must be in writing and given or sent to the Court Clerk. A copy of the request must also be given or sent to the attorney for the lender.  Homeowners can request a mediation by using the one-page Answer form attached to the foreclosure complaint, by filing an Answer without the form, or by writing a letter to the court to ask for mediation. 
  • How Do I prepare for mediation?
    Homeowners can call the Bureau of Consumer Credit Protection’s foreclosure hotline: 1-888-664-2569 to discuss the situation, to find a housing counselor, or to be directed to legal assistance.  In addition, the best preparation is to decide on your goals.  Do you want to stay in the house?  Do you have money to pay for it? Lenders can best prepare for mediation by knowing the status of the loan, having all documentation of the loan in order, and by bringing any forms required for review of the loan to mediation, even if the forms were previously provided with the complaint.  Lenders should know what options for loan modification apply in each situation, and should have obtained a reasonable fair market value of the property. 

  • What is the benefit of mediation?
    Parties have a chance to talk with each other in an informal setting.  The mediator is impartial and is trained to help parties discuss issues and explore options.  New ideas for settlement may come up at mediation that neither party knew were possible before meeting.  Parties make the decisions.  The mediator does not decide your case.  Because of the communication established in mediation, many foreclosure cases are dismissed.  More than half of the foreclosure cases mediated in the FDP from 2010 through 2015 were dismissed.
  • How Do I contact the Foreclosure Diversion Program staff?
    If you have questions or suggestions about the Foreclosure Diversion Program, please contact: Laura Pearlman, the Foreclosure Diversion Program Manager at (207) 822-0706 or by email
  • How Do I contact a Foreclosure Mediator?
    All Foreclosure Diversion Program mediators are independent contractors to the Judicial Branch. Their names appear here by consent.

Operation of the Foreclosure Diversion Program is governed by:

14 M.R.S. §6321-A and Maine Rule of Civil Procedure 93.

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