Real estate conflicts are stressful, costly, and often take months (if not years) to resolve.
Contract disputes, boundary issues, undisclosed defects… These problems can quickly turn nasty. For decades the only solution was litigation.
Real estate lawsuits are slow. Costly. And you give up all control.
That’s why homeowners and property investors are increasingly turning to mediation as a powerful alternative.
Needless to say: mediation provides a faster, cheaper, less adversarial means of resolving real estate conflicts.
Ready to learn more? You’ll discover:
- What Is Real Estate Mediation?
- Why Mediation is Becoming More Common
- Types of Disputes Mediation Can Solve
- How the Mediation Process Works
- Real Estate Litigation: When You’ll Need To Sue
Let’s dive in.
What Is Real Estate Mediation?
Simply put, real estate mediation involves a neutral third party that works with both sides to help settle a real property dispute out of court.
The mediator doesn’t issue a ruling or decide who is right or wrong. Their job is to help everyone come to a mutually agreeable resolution. Think of it as teamwork to avoid going to trial.
Nor can the mediator impose their own judgment as a judge or jury can. The mediator is there to facilitate communication and proposed solutions.
Any real estate attorney will tell you mediation has become one of the most powerful tools for resolving property disputes. Contract issues with a buyer, seller, landlord or tenant… A skilled Texas real estate litigation attorney can represent clients throughout the mediation process while ensuring their rights are protected.
Plus: the stats prove it works.
According to the recent CEDR Mediation Audit, the overall settlement rate of mediation stands at 92%. In other words, the vast majority of mediated disputes reached a resolution without stepping foot in a courtroom.
Take that litigation.
Why Mediation Is Becoming More Common
So why have so many homeowners and investors chosen mediation instead of lawsuits? Let’s explore a few reasons.
Mediation Saves Time
Civil litigation takes time. Years sometimes.
Filing paperwork, waiting on the court, stalled hearings… When you’re involved in a lawsuit it feels like nobody wants to move forward.
Mediation doesn’t have these issues. Most mediations can be scheduled within weeks and last only a day or two. When money, property, and relationships are on the line, speed is critical.
Mediation Saves You Money
Real estate litigation will cost you. Often between $10k and $20k+. Lawyers typically charge $150-$500+/hour for litigation cases. Hours quickly turn into dollars.
And mediation costs way less.
Generally, each side pays half the mediator’s fee and attorneys’ fees are lower due to the expedited process. Studies have shown mediation can reduce overall costs by up to 60-70% when compared to litigation.
THAT is what you save by choosing mediation.
Mediation is Confidential
Court cases are a matter of public record. Everyone can see what your dispute is about.
With mediation both parties can agree to keep things private. Everything discussed in mediation remains confidential. If you don’t want your neighbors, friends, or clients knowing about a dispute, mediation might be right for you.
Both Parties Have More Control
In litigation, you hand your power over to a judge (or jury). Someone who may not understand your situation makes the final decision.
With mediation you have control over the outcome. Since both sides collaborate on the resolution, you’re far more likely to reach a practical solution.
Types of Disputes Mediation Can Resolve
Mediation can be used to resolve many different types of real estate conflicts, such as:
- Contract disputes. Whether the buyer or seller isn’t holding up their end of the purchase agreement.
- Property defects. Issues that the seller failed to disclose before selling you the home.
- Boundary disputes. Neighbor disagreements over where property lines should be.
- Landlord tenant issues. Whether it’s over rent, repairs, lease violations, or evictions.
- Earnest money disagreements. Who gets to keep the deposit if a buyer or seller falls through.
These are just some of the most common real estate conflicts. But mediation has been successfully used to solve them all.
How The Mediation Process Works
The mediation process is simple and straightforward.
Step 1 — Agree to Mediate. The parties involved agree to mediation and select a neutral mediator. Ideally, one with real estate experience.
Step 2 — Prepare. Each side compiles documents such as the contract, inspection reports, and disclosure statements to prove their position.
Step 3 — The Mediation Meeting. Each party meets with the mediator and has a chance to explain their side of the story. Then, the mediator works with each side separately (and together) to work through any issues.
Step 4 — Resolution. If both parties can reach an agreement, the results are written up and deemed a binding settlement.
Step 5 — Back to Square One. If mediation doesn’t result in an agreement, parties are free to pursue arbitration or litigation. Mediation can fail. However, any information learned during mediation will usually make future proceedings simpler.
That’s all there is to it.
Litigation: When to File a Lawsuit
While mediation is a fantastic option for many disputes, it’s not always feasible.
Some conflicts require litigation. Usually if one side is being completely unreasonable or there’s a severe power imbalance. Cases that contain fraud or multiple parties. Very high stake cases can also require litigation.
Any case where mediation won’t work.
That being said, mediation should always be attempted first.
Real estate litigation is expensive and time-consuming. Mediation gives families and investors the best chance at a quick, cost-effective, mutually beneficial resolution. But part of that involves having a qualified attorney on your side that can take your case to court if needed.
Bringing Everything Together
Mediation has gone from alternative dispute resolution to the go-to solution for many homeowners and investors. Why?
Because mediation offers a way to resolve real estate conflicts that is:
- Faster. Neighborhood disputes can be settled in a matter of weeks.
- Inexpensive. Saving you tens of thousands of dollars in legal fees.
- Private. The details of the conflict never become public knowledge.
- Collaborative. Both sides have a voice in the matter and can reach a practical solution.
Sure, litigation is sometimes required. But with mediation offering over a 90% success rate, it’s always worth considering.