The Massachusetts Attorney General is two for two. In a decision rendered on November 10, 2008, a Massachusetts Superior Court judge enjoined subprime lenders H&R Block Mortgage Corp. and Option One Mortgage Corp. (collectively the “Defendants”) from foreclosing on any of their mortgage loans with Massachusetts subprime borrowers without the express prior approval of the Attorney General (Commonwealth of Massachusetts v. H&R Block, Inc., Block Financial Corp., Option One Mortgage Corp., H&R Block Mortgage Corp., AH Mortgage Acquisition Co., d/b/a American Home Mortgage Servicing Inc. (“H&R Mortgage”)1).

Relying substantially on its findings in the 2007 Fremont case,2 the court found that the Defendants, through their issuance of subprime loans to Massachusetts borrowers, violated:

M.G.L. c. 93A, § 2 by engaging in “unfair and deceptive acts and practices”; and M.G.L. c. 151B, § 4(3B) by discriminating against black and Latino borrowers.

The Defendants have been enjoined from foreclosing on any property secured by a Massachusetts loan whether or not it is considered presumptively unfair (discussed below) without first giving the Attorney General at least 30 days advanced written notice to examine the loan documentation. If the mortgages are deemed “presumptively unfair,” the Defendants may not foreclose without giving the Attorney General at least 45 days advanced written notice. If the Attorney General’s office objects, the parties have 15 additional days to resolve their differences regarding the proposed foreclosure. If they cannot reach a mutually agreeable resolution in that time period, then the Defendants may only proceed with a foreclosure if they receive court approval.

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