I am currently representing five homeowners in mediation. Should borrower attorneys be redacting confidential/senstitive information from the financials we submit as we would in a bankruptcy context?

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Interesting question. I'm not familiar with what you folks do in bankruptcy so I can't compare or contrast.

From the mediator's perspective, I would note that there is no confidentiality protection in the FFA for the mediation process. And for admissibility, I've heard a range of opinions including that anything happening in an FFA mediation is admissible. So you may be right to be concerned.

Yet any redaction or withholding would have to be weighed against whatever obligation you have to provide to the beneficiary/servicer the information required under the statute. And beyond whatever information the statute may require, there may be other information which, as a persuasive matter, the borrower would otherwise want the beneficiary/servicer to have in order to say "yes" to a loan modification. Hand a servicer a stack of paper with overly-aggressive black-outs might not put them in the modifying mood.

In a "normal" mediation I'd suggest this as a subject for pre-session discussion and agreement on what needs to be disclosed, what needs to be redacted/withheld, whether confidentiality protections could apply, etc. That's more challenging in this FFA context - some  beneficiaries/lender's counsel may be more willing to engage in those discussions before the mediation, some may not at all. I've seen both already, including extensions of the 45-day mediation period to conduct extensive negotiations working through the lender's normal loan modification process. And some mediators may be willing to help, others may be more hands-off.



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