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More MA Homeowners Skip Paying Their Mortgages

Thousands of homeowners in Massachusetts are living in their homes without paying their mortgages, according to the Boston Globe. Most of these property owners may be negotiating loan modifications or taking advantage of free housing as they wait for lenders to seize their homes.

Recent data from Lender Processing Services Inc. revealed that almost 36,000 borrowers throughout the state have not issued a mortgage check in at least three months, while a third of those homeowners have been behind their mortgage payments for a year or more.

Housing advocates said many property owners have failed to make mortgage payments due to unemployment, reduced earnings, or rising interest rates on subprime loans. Because the foreclosure process takes so long, most homeowners have already given up on trying to make payments and remain in their homes for months or even years.

“Some people slip through the cracks,” said Melonie Griffiths, who works with tenants and homeowners in Jamaica Plain for City Life/Vida Urbana.

The extended time it takes for lenders to foreclose on a home and evict the inhabitants can provide homeowners in Boston with a chance to potentially save their homes or collect enough money to rent an apartment. Lender Processing Services found that it takes an average of 583 days for a lender to seize a home after its owners have defaulted on a loan.

Borrowers are also given 150 days under MA state law to settle their financial problems before a lender can start the foreclosure process. But Federal Reserve Bank senior economist Paul S. Willen in Boston said one-third of homeowners who have been late on their mortgage payments for 60 days often stay delinquent for two more years.

To learn about your legal options after struggling to make mortgage payments, talk to an MA real estate lawyer who can explain what legal remedies may be available to you and other alternatives to foreclosure.

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