Your Options After a Foreclosure
Notas finales
Your options after a foreclosure depend on what the new owner wants and does, and what you want.
You could:
- Stay and continue renting,
- Stay until eviction,
- Take “cash for keys,” or
- Buy the property.
Read more to understand these options before you decide what to do.
14. A mortgage lender may be the Federal National Mortgage Association (Fannie Mae) or the Federal Home Loan Mortgage Corporation (Freddie Mac).
15. G.L. c. 186A, §1. Even if you are a family member of the former homeowner, you may still be able to stay if you are a tenant at will.
16. G.L. c. 186A, §2. A foreclosing owner can evict a tenant if a binding purchase and sale agreement has been executed with a bona fide third party purchaser.
17. Protecting Tenants at Foreclosure Act. Title VII of Public Law 111–22 section 702; Economic Growth Act, section 304, Pub. L. 115-174. Section 304 titled “Restoration of the Protecting Tenants at Foreclosure Act of 2009” and codified at 12 USC 5220 note.
18. Ducker v. Ducker, 1997 Mass. App Div. 147 (Northern District, September 22, 1997)(Court finds that payment of taxes, water, and sewer and utility bills is sufficient consideration to support creation of tenancy at will and 90 days’ notice was required prior to eviction.) See also FNMA v. Duarte, 84 Mass. App. Ct. 1136 (2014) (In a Rule 1:28 decision, the court noted that a tenancy at will requires consideration and the consent of both parties, and although consideration usually takes the form of rent, any consideration that would support a contract is sufficient. Affidavits and exhibits submitted by Ms. Duarte and her mother created a triable issue as to whether their “arrangement” was an oral agreement to create a tenancy at will and was supported by adequate consideration, and if there was a tenancy at will, whether the notice to quit was adequate.)
19. G.L. c 186 §13A.
20. G.L. c 186 §13A.
21. Wells Fargo Bank v. Roberto, Northeast Housing Court, No. 12-SP-2836 (Kerman, J., October 23, 2013) (Daughter of former mortgagor had a written lease with the former owner prior to the foreclosure. The notice to quit informed them they had 90 days to vacate "if you are a tenant," but the new owner commenced summary process prior to the expiration of 90 days. The Judge dismissed the case based upon this.) See also FNMA v. Rodriguez, Northeast Housing Court, No. 13-SP-3622 (Kerman, J., April 23, 2014) (At least a 30 day notice to quit was required for sister of former mortgagor who paid rent prior to the foreclosure pursuant to G.L. c 183, §§12 & 13.)
22. The use of injunctions as a substitute for summary process is frowned upon, because summary process is considered an adequate remedy at law. See Slavin v. Lewis, 101 Mass.App.Ct. 1110 (unpublished opinion 2022) (Homeowner moved out and sought a preliminary injunction to remove former romantic partner from the home. Court noted that “while the question remains whether summary process is the exclusive remedy available or whether Slavin may alternatively seek to remove Lewis by means of a trespass action and an injunction [. . .] there is a strong argument that summary process is indeed the exclusive remedy available) (citing General Laws c. 184, § 18, provides that “[n]o person shall attempt to recover possession of land or tenements in any manner other than through an action brought pursuant to [the summary process statute] or such other proceedings authorized by law.” Attorney General v. Dime Savings Bank, 413 Mass. 284, (1992) (barring foreclosing bank from evicting former owners or tenants of former owners by injunction for trespass). See also Serreze v. YWCA of Western Massachusetts, Inc., 30 Mass. App. Ct. 639, (1991) (Although a classic tenancy relationship did not exist, the court found a breach of quiet enjoyment under G.L. c. 186, §14 after a self-help eviction as the plaintiffs, as "occupants" of "residential premises," qualify for its protections and remedies). In some cases, though, even if summary process is required, an owner may be able to get injunctive relief where there is an immediate danger that needs to be addressed pending the outcome of the eviction. New Bedford Housing Authority v. Olan, 435 Mass. 364, (2001) (while public housing tenant is entitled to request jury trial where tenancy is annulled under G.L. c. 139, §19, preliminary injunctive relief prior to trial is possible if there is ongoing violence or drug activity in unit).
23. Federal Nat'l Mortgage Ass'n v. Gordon, 91 Mass. App. Ct. 527, 90 N.E.3d 661 (2017) (Tenant entered into lease with former owner after the bank both foreclosed and commenced a summary process action against the former owner. Fannie Mae attempted to remove the tenant through a trespass action. The court held that tenant was entitled to summary process where they entered with permission from the former homeowner who had actual possession of the property.)
24. Licensees are not allowed to raise certain defenses in court. Spencer v. Reynolds, Boston Housing Court, 12-SP-1987 (Muirhead, J., June 27, 2012) (Defendant moved into property at owner’s invitation, but relationship deteriorated. Court finds that defendant was a licensee and not a tenant and finds license properly revoked. No G.L. c. 239, §8A rights to defense or counterclaim for licensee. As occupant, defendant can bring claims for breach of warranty and habitability, but would have to be pursued separately. )
25. Owner cannot evict person lawfully in occupancy except through summary process under G.L. c. 239 or other appropriate civil process. G.L. c. 184, §18. See Federal Nat'l Mortgage Ass'n v. Gordon, 91 Mass. App. Ct. 527, 90 N.E.3d 661 (2017) in Note 24. See also Beacon Park Associates v. Corbett, Mass. App. Ct. (unreported), No. 96-J-693 (Lawrence, J., October 25, 1996) (single justice opinion authorizing injunction to exclude occupant who was licensee) See, Schachtel v. Hassan, Boston Housing Court, 08-CV-974 (Muirhead, J., December 18 2008) (Court finds that defendant allowed plaintiff to occupy premises and he had key and was free to come and go. No evidence to support claim Plaintiff paid rent. Court finds that it was plaintiff's burden to show that he paid rent, and absent such proof, he was a licensee; licensee entitled to reasonable notice of revocation of license, and if licensee then fails to vacate, licensor can only obtain relief through court. Court enters judgment for plaintiff and permanent injunction against removing him from premises without due process; owner is free to utilize summary process.) The criminal trespass statute, G.L. c. 266, §120, which allows arrest of persons not lawfully on property, does not apply if the person was an authorized occupant at some point prior to a claim of trespass.
26. Housing Courts allow the use of civil injunctions to declare that someone is a trespasser or licensee without right to occupy. See Beacon Park Associates in previous note (single justice opinion authorizing injunction to exclude occupant who was a terminated licensee.) Seeking such an injunction avoids illegal self-help (and possible damages for doing that). However, if there is a colorable claim of a tenancy, courts will usually deny an injunction. See Federal Nat'l Mortgage Ass'n v. Gordon in Note 24.
27. U.S. Bank National Assn. v. Adekunle & Anjorin, Boston Housing Court, 12-SP-3433 (and related civil action) (Winik, F.J., April 13, 2014) (Court authorizes changing of locks without further notice and holds that any personal property remaining in the property is deemed abandoned.)