BOSTON, Mass. (WWLP) — Attorney General Martha Coakley has declared Massachusetts to be under a “foreclosure crisis.” In response, the state Legislature has passed a bill spearheaded by Coakley that aims to reduce home foreclosures in the Commonwealth.
Earlier this week, a crowd of advocates gathered on the steps of the Massachusetts State House to rally in support of the legislation. Among them was Antonio Ennis of Dorchester, a proud working father of 6 girls who owns a clothing brand and retail store. But during the 2008 housing crisis, the value of his house went down and he began falling behind on payments, putting him at risk of foreclosure.
“If they reduce the principal …with my current income situation, I can get back on track with my obligation of paying the mortgage, and not just me, millions of other people can do the same thing,” said Ennis.
And that relief may just happen. The state Legislature has sent the governor a bill that requires banks to offer loan modifications to eligible homeowners when it’s cheaper to do so than to foreclose. According to Senate President Therese Murray’s office, the modified home loans could come in the form of a “reduced interest rate or principal, or an extension of the loan repayment period.”
Rep. Carl Sciortino (D-Medford) stood with outside rally goers in support of the legislation. “We are here because we have the opportunity with this legislation to protect families, to protect the communities and to make sure that our economy works for all people in the Commonwealth, not just the banks,” said Sciortino.
The financial services industry opposes the bill, but they did win on a controversial measure. The final bill does not require banks to go into mandatory mediation with homeowners, much to the disappointment of advocates.
“There is no negotiating table right now,” said Mass Alliance Against Predatory Lending coordinator Grace Ross. “The only proposal out there is a system where people send their documents back and forth through the mail …They often have to apply 3, 8, 10 times to get those documents accepted as complete …and that’s just untenable.”
Massachusetts foreclosures are up 32 percent from last year and foreclosure petitions, the first step in the process, are up 77 percent.
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