The threat of a foreclosure is scary. Whether you have lived in your home for many years, or just a few months, having to leave due to falling behind on payments is something that no one wants to have to do. However, if you receive a foreclosure notice, it is imperative that you do not just ignore it.
Massachusetts law has a very generous grace period for homeowners facing foreclosure, but in order to take full advantage, you have to address the default payments head on. If you are not sure how you want to proceed, but you know that you don’t want to lose your house, hiring an experienced Massachusetts real estate attorney is one way to ensure that your rights will be zealously advocated for.
Mass. G.L. Ch. 244 Section 35A (b) provides that, “a mortgagor of residential property shall have a 150-day right to cure a default of a required payment as provided in the residential mortgage or note secured by the residential property[.]” The default is cured by a full payment of all amounts that are due.
However, if the creditor can certify that it has made a good faith effort to negotiate a reasonable alternative to the foreclosure (as discussed below), and that its good faith effort has involved at least one meeting (which can include in person or by phone) with a creditor’s representative and the borrower/borrower’s attorney/borrower’s representative, and the meeting did not successfully resolve the dispute, the creditor can begin foreclosure proceedings after a 90-day period.
Additionally, if the borrower fails to respond within 30 days of any mailed communications offering to negotiate an alternative to foreclosure, that will be deemed a forfeiture to the 150-day period, and it will lead to the institution of the default period of 90 days.
Good faith efforts are defined explicitly in the section following the 150-day grace period.
A creditor will be deemed to have made a good faith effort to negotiate and agree upon a reasonable alternative to foreclosure if the creditor shows that it has taken into consideration:
- An assessment of the borrower’s current circumstances, including current income, debts, and other obligations;
- The net present value of receiving payments under a re-negotiated mortgage versus the potential net recovery following completion of the foreclosure process;
- The interests of the creditor; and
- Other factors.
Therefore, in order to ensure your best chance at saving your home, it is imperative that you do not ignore notices from the bank. People sometimes get behind on payments, jobs are lost, and life happens. However, imagine how much less stressful it seems to have a full five months to make up for past payments, as opposed to just three. Perhaps a new job can be secured, or something similar. The law does not guarantee that the entire 150-day cure period will be available, but it is a potential option if the correct process is followed.
Whatever your needs, the real estate attorneys at Pulgini & Norton, LLP are experienced in handling all of the potential issues that can arise during the process of buying or renting a home or property in Massachusetts. We represent clients in Brookline, Lowell, and Malden, among other Massachusetts communities. Call us today at 781-843-2200 or contact us online for a consultation.
More Blog Posts:
The Duty to Disclose Defects, or Lack Thereof, in Massachusetts Real Estate Transactions, Massachusetts Real Estate Lawyer Blog, published January 6, 2015
Anti-Big Box Zoning Proposed In Easthampton, Massachusetts, Massachusetts Real Estate Lawyer Blog, published December 30, 2014