On July 26, the Massachusetts state legislature passed a bill, H 4323, that establishes new pre-foreclosure requirements that will make it harder to foreclose in that state. Under the bill, prior to initiating a foreclosure sale, a creditor must make specified good faith efforts to avoid foreclosure, including assessing potential mortgage modification options. The bill sets up a pre-foreclosure process by which a creditor must notify a borrower of his or her right to a loan modification assessment. In addition, the bill (i) prohibits publication of a foreclosure notice if the creditor knows or should know that the mortgagee is neither the note holder or the note holder’s authorized agent, (ii) requires that assignments be recorded in the registry of deeds and that each assignment of a mortgage be referenced in any notice of foreclosure for a given property, and (iii) establishes a task force to study foreclosure mediation programs. Governor Deval Patrick is expected to sign the bill, the majority of which would take effect November 1, 2012.
