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How Do I Prepare for Real Estate Mediation?

Real estate disputes can happen for any number of reasons.

It might be that the seller of a home failed to disclose issues with the neighborhood sewer system, or a boundary dispute, or a disagreement between two co-owners.

And when these disagreements can’t be easily resolved, they often transform into lawsuits. But there’s an alternative to letting real estate disputes evolve into drawn out court cases: real estate mediation. Mediation is a form or Alternate Dispute Resolution. Unlike arbitration, which is another form of Alternate Dispute Resolution, mediation is voluntary.

Most real estate contracts now include terms that require mediation before the parties can initiate an action in court. Before bringing suit or before proceeding to arbitration, the buyer and the seller will agree upon a mediator to help them reach a settlement.

If you are about to begin real estate mediation, here are some things you can do to prepare:

1. Lay the groundwork

Do your homework. Try to determine what you hope to achieve through mediation. Work out how to illustrate the ways the dispute has affected you.

Prepare a detailed summary of your damages, and get estimates, invoices, receipts, checks and any other documentation you might need.

Finally, try to put yourself into the other side’s position to see if there is validity to the other side’s position.

2. What’s your plan B?

Figure out what steps you can take if mediation doesn’t work. Think about the risks of litigation, the cost, the time you’ll need to devote preparing for trial and the chances that you might not succeed in court.

If the mediation isn’t successful, what’s your next move? Will you take the case straight to court or try to settle the matter through arbitration?

Arbitration is similar to traditional court litigation. In arbitration, the parties make their case to a neutral third party (the arbitrator) who will render a decision in favor of one of the parties. For the most part, the arbitrator’s decision is final and binding. Unlike real estate mediation, which is voluntary, once the arbitration gets underway, neither party can withdraw except by an agreement. You won’t be able to stop the arbitration process if you become uneasy about the outcome.

3. Exchange information

Before the real estate mediation process begins, exchange information with your opponent and their lawyer. Give them a list of your claims and any supporting information, along with a summary of the damages and evidence of your expenses. You should also provide a summary of the witness/expert testimony you plan to present.

4. What do they want to get out of this?

You should try to determine what the other side hopes to achieve through mediation. Try to acknowledge what – if any – valid positions they might have. Do you owe them anything? Is there anything that’s low cost to you but of high value to them?

5. Final thoughts

Finally, identify everyone who needs to be there: family members, brokers, insurance adjusters, etc. There might also be industry specialists you want to recruit, such as home inspectors or contractors.

And remember that you and the other party are the decision makers here. The mediator’s job is to facilitate negotiation, to remove the emotions. The mediator should be a neutral objective party whose job it is to encourage the parties to negotiate a fair and reasonable resolution of the dispute. Mediation generally succeeds when the mediator is skilled and when both parties participate in good faith. Litigation is advocacy. Each side advocates his or her position to the judge and advocates why the other side’s position lacks merit. By its nature, litigation is adversarial. Mediation is about trying to negotiate a mutually satisfying outcome of a dispute with the assistance of a skilled mediator.

Contact us today and we can get to work on reaching an agreement that satisfies both you and your opponent’s wishes.

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