Massachusetts Land Court Upholds Validity of Home Foreclosure

In a newly issued opinion from the Massachusetts Land Court, Nutting v. Nationstar Mortgage, LLC (August 24, 2015), the homeowner-plaintiffs attempted to challenge the validity of a foreclosure sale of their home in their petition to try title pursuant to G.L. c. 240 §§ 1-5. They also argued that the subsequent foreclosure deed of the property was void based on errors in the chain of title, and that the defendants did not have lawful title to the property.

Under the Massachusetts try title statute, the court has subject matter jurisdiction only if the plaintiffs establish the following elements:  (1) they hold record title to the property; (2) they are in possession of the property; and (3) there is an actual or possible adverse claim clouding the plaintiffs’ record title. The plaintiffs are entitled to a presumption of truth with regard to the third element, and they are in possession of the property by currently residing in the house, satisfying the second element.   The only issue in dispute in Nutting was the first element, whether the plaintiffs held record title to the property.

If the plaintiffs could prove that at the time of the foreclosure, the foreclosing entity did not hold title to the property, they could satisfy the first element. Thus, to establish that they still held record title, the plaintiffs claimed that the foreclosure sale was void, arguing that the defendant did not hold both the promissory note and a valid assignment of mortgage at the time of the foreclosure sale. The court disagreed, however, stating that the underlying note and mortgage need not be conveyed together under Massachusetts law. As a result, a foreclosing mortgagee is not required to demonstrate that the previous holders of the recorded interest in the mortgage also held the note each time that the interest was assigned to the next holder.

The plaintiffs also claimed that the notice to cure sent to them pursuant to Massachusetts law was defective, based on the fact that the original mortgage company was not identified on the notice. The land court rejected this argument, holding that the omission of the mortgage originator does not render the foreclosure fundamentally unfair. The court held that the remaining arguments of the plaintiffs would, if proven, only render the foreclosure voidable, and they would not affect the validity of a foreclosure that had already occurred. Since the plaintiffs must demonstrate that the defect in the assignment renders the foreclosure void, not merely voidable, in order to establish their standing, the court denied their appeal for relief.

At the Massachusetts firm of Pulgini & Norton, our knowledgeable real estate attorneys represent clients in a variety of residential property law matters, including foreclosures, land use and zoning matters, easements, and other transactions. To discuss your real estate needs with one of our experienced attorneys, call (781) 990-2200 or contact us online.

More Blog Posts:

Massachusetts Supreme Judicial Court Finds in Favor of Homeowners, Voids Foreclosure Sale, Massachusetts Real Estate Lawyer Blog, published July 24, 2015

Massachusetts Court Affirms Bank’s Claim for Possession of Homeowner’s Property in Foreclosure Case, Massachusetts Real Estate Lawyer Blog, published August 7, 2015

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