Coakley: Bill Will Help Homeowners Avoid Unnecessary Foreclosures

BOSTON — A bill that would make substantial changes to the way home foreclosures are managed in Massachusetts is now waiting for a signature from Gov. Deval Patrick.

The bill, passed by the Massachusetts House and Senate earlier this week, would push banks toward modifying mortgages rather than moving them into foreclosure.

Massachusetts Attorney General Martha Coakley is urging the the governor to sign the bill.

“It really gives us a pretty good arsenal to get at this problem of unnecessary foreclosures,” Coakley told WBUR’s Morning Edition host Bob Oakes. “It’s simple, it’s straightforward. It addresses the issue that was the primary one we saw with knee-jerk, unnecessary foreclosures.”

The bill would require banks to do the math in order to prove that it makes more sense to modify a loan rather than foreclose. Coakley says that in many instances, mortgage modification makes more commercial sense for both parties.

While the bill has had overwhelming support in the Massachusetts Legislature, homeowner advocates say a provision added to the bill without debate would make it harder for people to sue lenders to get their homes back after illegal foreclosures.

However, Coakley says she is not concerned.

“We don’t believe that [this provision] actually affects existing rights or impairs in any way the rights of people who may be foreclosed upon wrongfully,” Coakley said.

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  • Sue Ladr

    I think it’s a shame that Attorney General Martha Coakley and the Massachusetts legislature caved in to the banks on the issues surrounding foreclosures. Having worked with an organization that tries to support homeowners (read families) in their dealings with banks and mortgage companies I strongly feel that the corporations have won in this case–and it’s business as usual. Records show that in states which have a mediation requirement, 80% of homes can be saved. Unfortunately, the mediation requirement was eliminated from HB4323. So 80% of families that might have been helped, will lose their homes in Massachusetts. Of course, the Governor could reinstate mandatory mediation before signing, and help many more people keep their homes. The banks might have to hire a few more people (gee, that would be terrible), but in the end, they would come out even, or better.

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