Massachusetts Real Estate Lawyer Blog
Last month, the number of Massachusetts borrowers who lost their home to foreclosure rose by approximately 41 percent over the previous year. In February 2012, 1,394 properties entered into foreclosure and 736 properties were foreclosed upon. Both numbers rose significantly from February 2011. In January 2012, mortgage petitions rose by about 68 percent over the previous year.
The rise in foreclosure rates may not be as alarming as they initially appear, however. According to a spokesperson for the Warren Group, a Boston firm that tracks activity in the real estate market, foreclosure activity stalled dramatically in early 2011 in response to alleged mortgage industry fraud. Many banks simply stopped processing foreclosures in 2011. The Warren Group’s Chief Executive Officer, Timothy M. Warren Jr., stated the rise in foreclosure numbers do not necessarily indicate a new wave of defaulting homeowners in the state. According to the Warren Group, because the number of deeds filed has dropped and that is the last step in the foreclosure process, banks are likely simply moving through their foreclosure backlog.
Last year, Attorney General Martha Coakley’s office received almost 1,000 mortgage and foreclosure related complaints. According to Coakley, addressing the mortgage foreclosure crisis is a critical step to restoring the Massachusetts economy. Last month, Massachusetts joined in a $25 billion foreclosure settlement with five major banks. The settlement is designed to provide homeowners who lost their homes through improper foreclosures with approximately $2,000 in compensation. Under the settlement terms, the Attorney General also maintained the ability to pursue claims against the banks for unlawful foreclosure practices in Massachusetts.