Monday, March 04, 2013
Today's New York Times reports that more than 700 members of the US military lost their home to foreclosure in violation of the Service Members Civil Relief Act. That law does not exempt homeowners in the military from foreclosure but it is intended to provide additional procedural safeguards. In these 700 cases, none of the additional requirements necessary to conduct a military foreclosure were followed. Massachusetts is one of only a handful of states (the only one, perhaps?) that make compliance with the Service Members Relief Act a judicial proceeding. That's where the Orders of Notice we frequently mention as indicators of a coming foreclosure come from. Massachusetts law requires a lender who wishes to foreclose on property owned by an individual to first file an action in Land Court or Superior Court the sole issue of which is determine whether anyone holding an interest in the property to be foreclosued is in the military. Once the complaint is filed, the court issues the Order of Notice that instructs the moving party in how notice must be provided to the homeowner. Notice always includes publication in a local newspaper, recording the notice at the registry of deeds, and either serving it on the homeowner or mailing it by certified mail. The notice instructs the homeowner to file an answer with the court by a certain date if he or she is in the military. No one else has any standing to raise issues in these cases. In other states, compliance with the Service Members Relief Act is accomplished by a representative of the foreclosing party (usually the attorney) signing an affidavit under the penalties of perjury that no one with an interest in the property was in the military. Given the well established practice of robosigning documents and proceeding on sketchy, mission, or fabricated information, it's not a surprise that these cases exist. I don't know how many if any are from Massachusetts. You'd like to think that our judicial procedure is more effective, but you do have to wonder whether a soldier deployed to Afghanistan could realistically be expected to respond to a certified letter, or see a legal notice in the hometown newspaper. But that's a post for another day.