The Massachusetts Land Court, located at 226 Causeway St. in Boston, is facing a case backlog created by the spike in Bay State foreclosures.
The spike in foreclosures has created a backlog at the Massachusetts Land Court.
The Land Court is five to six weeks behind in entering cases, or complaints filed by lenders against property owners, into its docket system.
The court faced a similar issue last November. Between fiscal year 2006 and fiscal year 2007, mortgage complaints jumped from 14,000 to nearly 25,000, a 78.5 percent increase, according to Deborah Patterson, recorder for the Land Court, which is located at 226 Causeway St. in Boston.
“What was happening, was we were getting more cases being filed and we did not have the staff to take them in or to process them,” said Patterson.
But after Chief Justice for Administration and Management Robert A. Mulligan allowed the court to hire additional full-time staff, it was able to catch up by mid-January, according to Patterson.
However, the court lost three employees over the summer through attrition. Patterson explained that one employee retired and two left for other jobs. The losses came as foreclosure complaints in Massachusetts continued to flood the court.
“The combination of losing those people and a hiring freeze because the budget hadn’t [been approved] and an increase in filings meant that again we fell behind, and that’s where we find ourselves now,” she said.
Last Tuesday, the Land Court posted three job openings for case specialists, who are responsible for data entry. Patterson said she hopes that after three case specialists are hired, the court will be able to eliminate the backlog. The court has 52 employees, eight of whom handle data entry.
Foreclosure activity statewide has more than doubled in the last two years, according to The Warren Group, parent company of Banker & Tradesman. Lenders filed 18,546 petitions to foreclose, the first step in the foreclosure process, through August of this year. That’s 152 percent more than the 7,351 petitions that were filed during the same months in 2005.
With every filing, court officials have to determine whether borrowers facing foreclosure are in the military. Under the Servicemembers Civil Relief Act, active-duty military personnel are entitled to mortgage payment relief and protection from foreclosure.
The delay in processing the cases at Land Court could give borrowers more time to obtain resources to catch up on missed mortgage payments and negotiate with lenders.
But Thomas M. Callahan, executive director of the Massachusetts Affordable Housing Alliance, said that for most homeowners, that additional time also will mean that hefty legal fees and other penalties are accruing.
“On the surface, extra time is a good thing. But time, when it’s costing extra money in terms of legal fees and penalties, can work to have the opposite effect of making it harder for borrowers to catch up,” said Callahan.
‘It’s Frustrating’
Legislators and Gov. Deval Patrick have tried to address the foreclosure issue. The House and Senate have passed separate versions of bills designed to prevent foreclosures and predatory lending. In April, Patrick directed the state Division of Banks to work with lenders and mortgage services to delay the foreclosure process for homeowners in order to enable them to consider alternatives, such as loan workouts.
The Division of Banks has secured 30- to 60-day delays for nearly 500 homeowners since April 30, according to testimony that Massachusetts Commissioner of Banks Steven L. Antonakes provided to the federal legislators last month.
On the federal level, the House Committee on Financial Services last week approved mortgage reform legislation that would create a licensing system for residential mortgage loan originators and establish a minimum standard requiring that borrowers have a reasonable ability to repay a loan. A section of the bill also attaches limited liability to secondary market securitizers who package and sell interest in home mortgage loans outside of those standards.
Many housing advocacy groups are watching the proposed federal and state legislation closely.
“Nothing has been passed yet, so there’s no immediate impact from these legislative efforts. Most of the legislative efforts are designed to make the situation better for consumers going forward, as opposed to totally fixing the situation we’re in,” said Callahan. “It’s frustrating for groups like ours. It’s frustrating for consumers. These legislative efforts are more designed to create a better mortgage lending environment for future consumers.”
