by Alan White
Massachusetts Attorney General Martha Coakley persuaded a judge to order a 90-day statewide halt to foreclosures by Fremont Investment and Loan, so that Fremont could work out some of the defaults with borrowers. The press release includes a link to the 29-page decision. In his February 25 order, Judge Gant wrote: “It is both imprudent and unfair to approve a mortgage loan that the borrower cannot reasonably be expected to repay if housing prices were to fall. Just because we, as a society, failed earlier to recognize that loans with these . . . characteristics were generally unfair does not mean that we should ignore their tragic consequences and fail now to recognize their unfairness.” The order requires Fremont to notify the AG before foreclosing, and allows the court to review foreclosures on a case-by-case basis to determine whether the loan was unfair and whether Fremont has taken reasonable steps to explore alternative payment arrangements. This is the first such statewide foreclosure injunction, albeit against only one servicer, of which I am aware.
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