We are working with the Massachusetts Alliance Against Predatory Lending to pass the following critical bills.
Tenant Protections in Foreclosed Properties
HB1729/SB1609 Lead Sponsors: Rep. Malia, Sen. Chandler
This bill would enable tenants to pay rent and stay in their homes when a lender takes back a property through foreclosure. Lender-landlords who foreclose will not be able to evict residents unless they can show good reason. Otherwise, tenants (tenants, tenant-at-will, tenants-at-sufferance) can remain while paying rent and abiding by the standard rules of tenancies. Foreclosed properties currently average over 11 months on the market before re-sale. Our municipalities are scrambling to address numerous vacant and unsupervised properties, degrading neighborhoods and dropping property values. Buildings left vacant for months are targets for catastrophes such as burst pipes fire, vandalism, disrepair due to neglect. This bill will keep people in their homes and help to stabilize neighborhoods during the current crisis.
Judicial Foreclosures – Right To A Day in Court
HB1232/SB1778 Lead Sponsors: Rep. Smizik, Sen Morrissey
This amendment to the foreclosure law will enable Massachusetts to join with 29 other states (including New York, Connecticut, South Carolina, and Kentucky) in requiring that a court approve foreclosures. Currently, even if a lender violates the law or makes an error in the amount owed, borrowers have no right to have a judge rule on whether a foreclosure is warranted. Massachusetts, a leader in protections for tenants, should provide equal judicial process for homeowners in danger of losing their homes. Many borrowers got mortgages through now defunct brokers. They must deal with large, out of state companies and hopeless bureaucracies, unable to find anyone with authority or willingness to renegotiate their loan.
Temporary Moratorium on Foreclosures
HB1510/SB1751 Lead Sponsors: Rep Lantigua, Sen Montigny
This bill provides for a 6 month moratorium on foreclosures involving sub-prime and other "creative" mortgages instruments that are presumptively unfair. It keeps homeowners from losing their homes while mandated negotiations by lenders and more comprehensive solutions are affected on either the federal or state level. Foreclosures not only devastate the borrowers who lose their homes, but also entire communities. They lead to lower property values, abandoned homes, less tax revenue, higher crime rates and the general destabilization of our neighborhoods. The moratorium will apply to sub-prime loans which unfairly lure borrowers with low introductory rates that increase dramatically; loans at 97% or more of house's value; interest only loans; loans with substantial pre-payment penalties; interest only loans; loans that have high points, fees or interest in violation of the Massachusetts predatory loan law. In 1991, the Massachusetts Legislature passed a similar moratorium to help victims of home improvement loan scams. New York and New Jersey are among states now considering foreclosure moratoriums.
Massachusetts Foreclosure Mediation Program
HB4003 Lead Sponsor: Representative Pedone
This amendment would provide that the mortgagor be offered the opportunity to participate in a court-supervised Foreclosure Mediation Program. In that program the mortgagor will have the opportunity to negotiate an agreement with the mortgagee. This would provide that a foreclosure shall not be initiated unless a good faith effort has been made by the mortgagor to review the borrower's financial situation and whenever feasible provide a loan modification or other option to assist the borrower.