Thursday, March 10, 2011

MA Supreme Court Rules for Homeowners, not Banks, in Foreclosure Cases

A recent Massachusetts Supreme Judicial Court ruling on two separate cases may have a major impact on foreclosures throughout the United States.

The Massachusetts Supreme Court ruled that, because the banks which were moving for foreclosure did not submit proper evidence that they had the right to foreclose, they could not foreclose. (These banks were not the original lenders, and thus the mortgage loans were not in their names.) These cases were examples of how confusing it can be to even tell who holds the rights to a mortgage loan, as such loans are often sold by the original lender within days after the sale closes.

You may be wondering how this ruling may affect your foreclosure. If you are faced with foreclosure, you can request that the entity which has begun the foreclosure proceedings against your home produce proper evidence that it has the right to initiate the foreclosure action and to foreclose. (For example, if the original lender was Acme Smith Bank but someone else – say John Doe Savings and Loan - is bringing the foreclosure case, shouldn’t John Doe Savings and Loan have to prove that it inherited Acme Smith Bank’s right to foreclose?)

Keep in mind that the ruling by the Massachusetts Supreme Court only impacts cases in that state. However, the ruling is important and may have indirect influence across the country.

McGrath & Spielberger, PLLC may be able to assist you with a mortgage loan modification or foreclosure prevention.