If you own and live in your home in Philadelphia and your lender has filed for foreclosure, you have something many homeowners in other places do not: a court program built to slow the process down and get you in a room with the lender. Knowing how it works, and acting early, is the difference between having options and running out of them.
What the Diversion Program is
Since 2008, the Philadelphia Court of Common Pleas has run the Residential Mortgage Foreclosure Diversion Program for owner-occupied homes. When a lender files a mortgage foreclosure case on a home the owner lives in, the court schedules a conciliation conference and the lender cannot enter judgment until those conferences are finished. At the conference, homeowners meet face to face with the lender's attorneys to work on alternatives, with housing counselors and legal aid attorneys available in the courtroom.
Call the hotline before the conference
Homeowners are told to call the Save Your Home Philly Hotline (215-334-HOME) before their conference. A housing counselor will help you gather your income documents, look at what you can afford and prepare an application for a loan modification or other workout. Showing up prepared matters. If a homeowner does not attend the first conference, the case goes back to its ordinary course and the lender can move toward judgment and a Sheriff Sale.
If your case was not marked owner-occupied
The program applies to residential owner-occupied homes. If you live in the house and believe your case should have been designated that way, the court allows you to file a certification and request a conference. Do this quickly, because a case that is not in the program can move toward a sale much faster.
When selling is the better outcome
The Diversion Program is designed to keep people in their homes, and for many families it works. For others, the numbers do not: the payment is not affordable even with a modification, the house needs repairs no one can pay for, or the family has already moved on. If you have equity, selling before a Sheriff Sale lets you pay off the loan at closing and keep what is left, instead of risking it at auction. Timing matters, because the sale has to close before the Sheriff Sale date.
How we help
We look at your payoff, the condition of the house and your timeline, and give you a written offer with every cost listed. If the Diversion Program looks like your best path, we will tell you that. If selling is better, we coordinate with the title company to close before your sale date. We never ask anyone to sign over a deed outside a proper closing.