Wednesday, December 7, 2011

News Alert on Recent Legal Actions Pertaining to Foreclosure Properties

Two foreclosure-related rulings by Massachusetts' highest court, the Supreme Judicial Court, should serve to alert buyers of foreclosed properties that ownership of certain properties may be in question.

In January 2011, the Court affirmed a lower court’s ruling invalidating two mortgage foreclosure sales because the banks, in their capacity as trustees for mortgage securities, did not prove that they actually owned mortgages at the time of foreclosure. (see U.S. Bank v. Ibanez)

On October 18, 2011, the Massachusetts Supreme Judicial Court ruled that individuals who purchased foreclosed homes from lenders who seized the property without first obtaining a clear title many not be the legal owners. (see Bevilacqua v. Rodriguez)

Massachusetts Attorney General Martha Coakley filed a civil action suit in the Suffolk Superior Court on December 1, 2011, against Bank of America, BAC Home Loans Servicing, BAC GP, JPMorgan Chase Bank, Citibank, CitiMortgage, GMAC Mortgage, Wells Fargo Bank, Mortgage Electronic Registration System and MERSCORP. In this action, Attorney General Coakley identifies the following examples of misconduct that lead to this filing:

1. Engaging in unfair and deceptive foreclosure practices by conducting foreclosures when the defendants lacked the right to do so and misrepresenting to homeowners their roles as mortgagees or as the holders of the mortgages;

2. Engaging in false documentation practices to facilitate their foreclosure practices;

3.Deceiving homeowners in the course of servicing mortgage loans by misrepresenting to borrowers regarding its loan modification programs, acting deceptively in implementing loan modifications and deceiving borrowers regarding foreclosure proceedings; and

4. Failing to comply with Massachusetts’ registration statute.

For more information or questions relative to home ownership/foreclosures, contact the Attorney General’s office at (413) 784-1240 or visit her website at

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