Massachusetts has three types of foreclosures:
- Judicial Foreclosure: The least common type of foreclosure in Massachusetts, a mortgagee can go to court and get an order allowing it foreclosure. Doesn’t happen very often.
- Foreclosure by Entry: A foreclosure by entry is when a mortgagee makes an “open and peaceful” entry on the premises and records a certificate in the land records. The mortgagor has three years from the date of recording to oppose it, or foreclosure loses the right to challenge foreclosure. Foreclosure by entry serves as a backup option for mortgagee; many times a mortgagee will start a foreclosure by entry at the same time if begins a non-judicial foreclosure. If, for any reason the non-judicial foreclosure is unsuccessful, the mortgagee can rely on the foreclosure by entry (assuming the mortgagor fails to oppose the entry). More on this to come . . .
- Non-Judicial Foreclosure: A non-judicial foreclosure, as known as a foreclosure by power of sale, is the most common type of foreclosure in Massachusetts. A non-judicial foreclosure has extensive notice requirements and procedural requirements, including publication in a local newspaper and a public foreclosure auction.
In the world of foreclosure defense, many myths exist. Thanks to the email and the Internet, it’s easy to get the wrong information about this important area of law. The Massachusetts Foreclosure Law Blog presents the top 3 myths about foreclosure defense:
1. “With all the fraud by big banks and lawsuits against financial institutions, fighting a foreclosure is breeze.”
THE TRUTH: Foreclosure defense is tricky, technical work. While there are many stories about fraud in the foreclosure process, proving fraud is tough. In fact, most successful defenses to foreclosures involve “devil in the detail” arguments, and few about actual fraud. I have a little doubt that fraud and other shenanigans does occur by foreclosing entities, but successful defenses often require much less obvious—and much more boring—arguments.
2. “Fighting a foreclosure means I’ll get a free home.”
THE TRUTH: While it is possible to fight a foreclosure, it is much, much more difficult to fight a mortgage. In short, while you may be able to beat foreclosure, the mortgage still exists, and the mortgagee can, and almost certainty will, begin a new foreclosure if the existing foreclosure is void. This will take time (2-3 years by my estimate under the current laws). So, while fighting a foreclosure ensures you more time, it does solve the underlining problem on its own. Rather, fighting a foreclosure opens the door to a possible settlement with your lender or possible help from state/federal programs aimed at keeping people in their homes.
2. “Fighting a foreclosure is always the best thing to do when faced with an eviction notice from the bank.”
THE TRUTH: The decision on whether to fight a foreclosure is not always a legal one. You should consult a financial adviser who can discuss the financial implications of a foreclosure defense. While a lawyer can tell you whether the foreclosure can be beat, a financial adviser can discuss with whether such a strategy is in your long-term, financial interest.