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Mortgage Foreclosure Procedures – New Massachusetts Regulations Effective June 21, 2013

Synopsis of article:

The Division of Banks released final amendments to the state Foreclosure Prevention regulations in early June, which implement Massachusetts General Laws ch. 244 §35B.  The revised regulations become effective June 21, 2013.  Use of the regulatory form of Right to Request a Modified Mortgage Loan Notice becomes mandatory on September 18, 2013.

Executive Summary

Massachusetts law prohibits a creditor from publishing notice of an intended foreclosure sale with respect to “certain mortgage loans” unless the creditor “has first taken reasonable steps and made a good faith effort to avoid foreclosure.”  The law applies to loans for personal, family, or household purposes secured by a mortgage on an owner-occupied residential property with one or more of eight
enumerated “high risk” features (such as a deeply discounted introductory rate, a period of interest only payments, or a high loan-to-value ratio).  All creditors are subject to the rules; the rules are not limited to financial institutions that are otherwise subject to the supervision of the Division of Banks.

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