By Bob Katzen

The Financial Services Committee held a hearing on a bill that would create a Massachusetts Foreclosure Prevention Program to assist homeowners in avoiding foreclosure through supervised pre-foreclosure conferences between creditors and borrowers regarding foreclosure alternatives.

Conferences would result in a report, and foreclosures can only proceed with a Certificate of Compliance, contingent on a creditor’s good-faith efforts to negotiate. Judicial enforcement provisions allow sanctions against non-compliant creditors, including interest tolling, penalties or dismissal of foreclosure actions. The program would be funded by the Foreclosure Prevention Fund, supported by creditor fees to cover administrative costs such as conference monitors and outreach initiatives.

“With Massachusetts foreclosures on the rise, updated state laws that better protect homeowners are long overdue,” said sponsor Sen. Adam Gomez (D-Springfield). “In the Pioneer Valley, more than half of all renters are ‘cost burdened,’ spending 30 percent or more of their income on housing. This trend is even worse for communities of color in the region, such as Springfield where we continue to face serious housing stability challenges.”