In a landmark decision, the Massachusetts Supreme Judicial Court upheld a 2009 ruling by the Massachusetts Land Court regarding foreclosure proceedings. The ruling of US Bank National Association v. Ibanez has arguably proved Massachusetts to be one of the most consumer-orientated and non-bank friendly states in the nation. Justice Ralph Gants, speaking for a unanimous court, ruled Wells Fargo and US Bancorp lacked the authority to foreclose on Antonio Ibanez's property after having "failed to make the required showing that they were the holders of the mortgages at the time of foreclosure."
The ruling upheld a decision from 2009 which stated that all original documents must be in possession of the bank before it begins the foreclosure process on a property. Since that decision by the Land Court, many mortgage companies and financial experts tried arguing that only the original promissory note was necessary for the foreclosure process to begin, but the recent ruling by the high court upholds otherwise for Massachusetts.
The Commerce Clause of the United States Constitution enables interstate trade in goods and services, but the ownership and transfer of property has been and remains a state issue. This means that Uniform Commercial Code, established in the 1950s to establish a mortgage as a strictly legal document, must follow state laws when it comes to possession of mortgage documents and the foreclosure process.
Financial experts had long been under the impression that the UCC would cover any faulty or missing legal documents, but the decisions made in this recent case underline the fact that the final assignment of the mortgage note needs to be properly completed and in line with state law. The Massachusetts Supreme Court has now made it clear that the chain of title must be perfected and in good order before any foreclosure proceedings take place.
The ruling has voided many home foreclosures in Massachusetts and will make it difficult for mortgage companies to foreclose Massachusetts properties by Wells Fargo and Bancorp. What this means for homeowners facing overwhelming debt and possible foreclosure is that there are options if you are a Massachusetts property owner facing foreclosure. Consult an experienced real estate law office such as P&P Law, which may be able to slow down or stop foreclosure proceedings on your property by virtue of this ruling. Consumers have options in Massachusetts and should not give up on properties because their mortgage companies are proceeding with foreclosure.
