In this blog post, I want to discuss the options available to stop foreclosure in Massachusetts. Massachusetts is a non-judicial foreclosure state, meaning that a bank does not need to go to court to foreclose a home. Instead, a bank can foreclose through sending a number of required notices to the homeowner and publishing these notices in a local newspaper. As such, the options for stopping a foreclosure are not as apparent as they would be if the matter occurred in a court case (such as the eviction process required against tenants). Fortunately, homeowners do have options available to stop foreclosure in Massachusetts.
Applying for a Loan Modification
A homeowner’s first option to stop foreclosure is applying for a loan modification. A loan modification is a restructuring of a mortgage loan to make the payments more affordable for the homeowner. Federal law often requires banks to stop foreclosure after a borrower applies for a loan modification, and many banks (allegedly) have policies that put foreclosure sales on hold while an application is under review.
A common misconception among many homeowners is that any submitted loan modification application will stop foreclosure. This is not correct. While a loan modification application submitted well in advance of a foreclosure sale will generally put a foreclosure on hold, a bank will not necessarily stop foreclosure if it receives a application close to a scheduled foreclosure sale. Moreover, many banks, who are overwhelmed with loan modification applications and understaffed, sometimes “forget” to stop a foreclosure sale, even after telling the homeowner they would do so.
If you apply for a loan modification, you should confirm with the bank that no foreclosure sale is pending, and try to get this in writing. Moreover, you should closely watch the situation to make sure a foreclosure sale is not scheduled. If you have reason to believe a foreclosure is going to occur, read on for the other options to stop foreclosure.
Another option to stop foreclosure is to file bankruptcy. Bankruptcy puts an automatic stay on all actions by creditors, including foreclosure. I am not a bankruptcy lawyer, so you should speak to an experienced professional in this area of law to decide if this option is right for you.
Obtaining the Assistance of A Foreclosure Defense Attorney
If a homeowner is unable to stop foreclosure on their own, it is time to speak with a foreclosure defense attorney. An experienced attorney can determine whether there are legal options available for requesting a court order to stop foreclosure. An attorney may be able to obtain a preliminary injunction from a court, which is a court order preventing a bank from foreclosing while the lawsuit proceeds.
If you find yourself in need of assistance with such a matter, contact me for a consultation.