New Foreclosure Law

The legislation will protect renters from being evicted just because their landlord defaults on the home they’re renting. The bill also encourages banks to negotiate a loan modification by making banks wait five months – instead of 90 days – before foreclosing if a modification can’t be reached. This will pressure banks to think about having face-to-face conversations with homeowners before a foreclosure, Patrick said.

But Jon Skarin, director of federal policy at the Massachusetts Bankers Association, said the bill offers few specifics for banks on how to comply with the law.

The bill extends the existing 90-day right-to-cure period another 60 days. But it doesn’t indicate whether homes already in the foreclosure process will be subject to the extension.

“People are trying to get their hands around it. They are trying to figure out how to comply with it in a very, very short period of time,” Skarin said.

The existing 90-day right-to-cure period often doesn’t begin until a homeowner is two to three months late on their mortgage payments, Skarin said.

And Annmarie Hewitt, director of loan operations at Rockland Trust Co., said the extension will have little immediate effect on banks.

While some people may need an additional two months to be able to prevent a foreclosure, Hewitt said generally, Rockland Trust doesn’t foreclose that quickly.