Massachusetts Foreclosures, Workouts, Short Sales, Bank Owned Property and 90 Day Right to Cure Defaults: Are the Floodgates About to Open on MA Foreclosures Again? Solutions for Banks, Borrowers, Owners and Buyers Available, but Action Needed.

The Lowell Deeds Blog reports statistics for Middlesex North Registry of Deeds :

2008 is half over, so I compared our recording activity during the past six months with the first six months of 2007. For the entire ten town district, here’s what I found:
Deeds in 2007 - 3346; in 2008 - 2630, a 21% decline
Mortgages in 2007 - 8619; in 2008 - 6500, a 25% decline
Foreclosures in 2007 - 186; in 2008 - 328, a 76% increase

I suspect the new Massachusetts mortgage foreclosure law will probably reduce the number of residential foreclosures for the short term (as notice requirements and waiting periods are met under the right to cure provision/extension). This seems to be playing out currently as discussed in the post Massachusetts Foreclosure Law Creates Calm Before the Storm.

A new mandate included in a Massachusetts foreclosure law has prompted the number of foreclosure filings in the state to fall to 392 filings in May from 3,414 filings the month before, according to ForeclosuresMass.com, a provider of Massachusetts foreclosure data.

Perhaps the new law will help motivate banks and mortgage lenders to work with distressed owners. Workout agreements, short sales, and other alternatives can help provide solutions and assist in preventing a property's waste. As foreclosed properties sit vacant and unattended they are both declining in value and experiencing a host of problems. Yesterday, in Weymouth, MA, I had another client walk away from a foreclosure or bank purchase after an inspection revealed mold was everywhere.

Given the picture painted by the statistics, bank owned properties' challenges, and the new Massachusetts law perhaps now is a time for owners in over their heads to consider seeking the help of an attorney in avoiding foreclosure and protecting their interests. Banks and investors too need to consider what's in their best interest. Unless something is done, the floodgates may be prepared to open as the extended right to cure defaults period (90 days) begins to run out for future foreclosure candidates. Time will tell...