The foreclosure process varies across the United States, but the process traditionally occurs in one of two ways: judicial or non-judicial foreclosures. Residential foreclosures in Massachusetts are non-judicial, which means that the foreclosure process happens outside of the courtroom. Non-judicial foreclosures, also known as power of sale foreclosures, allow the mortgagee to sell the property if the mortgagor defaults on their loan provided the mortgagee complies with the statutory requirements under G.L.c. 244 §§ 11-17B. In addition to the requirements under the statute, mortgagees owe mortgagors a duty of good faith and reasonable diligence to protect their interest in the property.
Even technical errors in mortgage and foreclosure documents can invalidate the foreclosure and subsequent sale of a condominium unit, according to the Massachusetts Housing Court. Following foreclosure, and purchase at the foreclosure sale by the foreclosing bank, the former owner asserted that erroneous references in the foreclosure documentation for the unit invalidated the foreclosure and left her with the superior right of possession. The Housing Court, J. Muirhead, agreed and invalidated the foreclosure. East West Bank v. Chung, Lawyers Weekly No. 17-001-13.