Tuesday, August 12, 2014

Back to the drawing board for An Act Clearing Titles?

As this year's session of the state legislature came to a close at the end of July, it seemed that Senate Bill 1987, An Act clearing titles to foreclosed property, would be enacted.  Back then, I wrote a blog post explaining the details of the bill.

Although the bill passed the House on a unanimous voice vote in the closing hours of the session, it turned out to be a controversial measure.  Advocates for victims of improper foreclosures objected to what was essentially a three year statute of limitations to challenge a foreclosure.  They take the position that the current statute of limitations is 20 years which is the case for an action of ejectment (used most often in adverse possession cases) and offered an amendment making the time limit 10 years.  Proponents of the bill argued that the shorter time period was necessary to make titles that have a foreclosure in their recent past marketable and that on balance, the public interest was best served by assisting innocent third party purchases of these properties with the shorter time limit.

According to Attorney Richard Vetstein on his Massachusetts Real Estate Blog, Governor Patrick did not sign the bill but sent it back to the legislature with a proposed amendment that would make the time limit 10 years.  Attorney Vetstein surmises that this will effectively kill the bill at this time since it's unlikely that its proponents will agree to the longer time limit.  If that occurs, proponents could refile the bill in the next legislative session, hope that it passes in its current form and hope that the new governor will go ahead and sign it.   

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