At Issue & In Focus

AG Coakley Announces Legislative Agenda

Attorney General Martha Coakley today announced the filing of nine bills as a part of her legislative agenda. The series of bills seek to better protect public safety, combat fraud and corruption, and address the foreclosure crisis in Massachusetts. The bills include legislation that would establish standards and require banks to engage in loan modifications when they are financially beneficial to the bank before foreclosing on a property.  The AG’s Office also filed comprehensive human trafficking legislation that would establish human trafficking for sexual servitude or labor as a crime in Massachusetts, one of only five states in the country without human trafficking laws. Additionally, the AG’s Office filed comprehensive economic crime legislation designed to give law enforcement the necessary tools to investigate and prosecute sophisticated criminal activities and enterprises in the 21^st century.  Other bills filed relate to drug trafficking in methamphetamine, corporate manslaughter, dissemination of harmful materials to minors, manufactured housing, metals dealing, and the failure to have workers’ compensation insurance.  To see the full press release, click here.

Avoiding Foreclosure Through Education

Six months ago, the Attorney General’s Office (AGO) awarded over $1.1 million in financial literacy grants to the areas hit hardest by the mortgage crisis and economic downturn.  Funds for this program come from the settlement of the AGO’s  enforcement action against Fremont Investment & Loan and its parent company, Fremont General Corporation. As part of the settlement, Fremont has also agreed not to foreclose upon unfair loans without certain protections for borrowers or originate unfair loans in the Commonwealth.

These grants have allowed 18 organizations from across the commonwealth to educate homeowners on avoiding high-risk mortgages and help those facing foreclosure.  A total of 983 participants have attended 86 workshops, and 650 have attended Foreclosure Prevention Counseling.  These programs have yielded 123 legal cases, including five Class Action cases, and have saved 63 houses from foreclosure so far this year.

Outside of the grant program, the AGO continues to support and inform new and re-financing homeowners.  The AGO provides a direct link to updates on policies and procedures regarding mortgage loans, as well as more information on loan modification scams.  The Office is also a direct link to attorneys that are currently handling subprime and predatory lending cases.  For more information on the Financial Literacy Grant Program, along with other home and housing information, visit the AGO website.

Lead Paint Safety in Massachusetts

The Attorney General’s Office Childhood Lead Poisoning Prevention grant program, which concluded last month, supported public health programs across the Commonwealth in their efforts to provide lead poisoning education, outreach and testing to underserved populations statewide. Using funding from a national, multi-state settlement agreement with Mattel, Inc., and its subsidiary, Fisher-Price, Inc, the AGO awarded $433,000 to nine public health programs across the Commonwealth to provide education, outreach and testing to underserved populations.

Overall, the grantees distributed more than 15,000 pieces of educational material to families and individuals at risk for lead poisoning. Over 4,000 people learned about the affects of lead poisoning and how to protect children and others. The AGO grantees also participated in 230 different health fairs and education sessions over the course of the year. In addition, the Massachusetts Coalition for Occupation Safety and Health (MassCOSH) co-produced a play exposing the dangers of lead poisoning for day laborers and their families. The program was a onetime funding opportunity, but for the AGO and our community partners, the work goes on.

In addition to education and prevention, the AGO continues to prosecute lead paint violations, largely arising from the discriminatory refusal of landlords to rent an apartment to families with children. 

To learn more about the AGO grantees visit the AGO website. For more information on childhood lead paint testing and activities as part of the Massachusetts Lead Poisoning Prevention week, visit the Massachusetts Department of Public Health’s Childhood Lead Poisoning Prevention Program.

Randolph House Restored Through Abandoned Housing Initiative

Abandoned properties impact communities in many ways. They affect public safety, degrade property values of neighboring homes, and present a tax burden for communities.  Through the Attorney General’s Abandoned Housing Initiative (AHI), the AGO works with communities to use code enforcement to bring the property in compliance with the state sanitary code and make the necessary repairs to bring the properties back to full use.   

Today, AG Coakley toured a nearly completed property in Randolph, MA The house; located at 111 Lafayette St. in Randolph has been a problem property for the Randolph Board of Health and neighbors alike.  Sitting on one of Randolph’s main thoroughfares, the town has received numerous complaints on the condition of property from residents over the past several years. 

Through a partnership between the Town Manager’s Office, the Randolph Board of Health, the Building Department, and the Town Attorney, the AGO successfully petitioned Quincy District Court this past March to utilize the receivership statute in the State Sanitary Code to have a court-appointed receiver oversee the renovation of the property.

Today’s tour showcased the significant progress in the renovation of the Lafayette house.  AG Coakley was guided by Karl Wells, the court-appointed receiver, and members of his contracting team, all of which are local Randolph residents.  Also joining the tour were Undersecretary Tina Brooks of the Department of Housing and Community Development, who awarded grant funding through the Neighborhood Stabilization Program 1 to enhance the Abandoned Housing Initiative, and John McVeigh, Board of Health Director for the town of Randolph. For pictures of today’s event visit our flickr.com page.

Be on the Lookout for Loan Modification Scams

According to a recent Boston Globe article, foreclosure petitions rose 21% in the month of March.

If you are currently having trouble paying your mortgage or expect problems in the future, it’s crucial that you get help now.  If you fall behind and don’t take action, your lender will take steps to foreclose on your home. If that happens, you may lose your home and all of the money you have already invested in it.

Before engaging the services of a loan modification service, talk with your lender first. In some instances, a lender may be willing to rewrite the terms of your loan in order to address a delinquency.  A loan modification is designed to make your monthly payment affordable.  It is intended to serve as a long-term solution when the monthly payments under the original loan terms are unsustainable for you.

It is important to proceed cautiously before using  a loan modification service. Watch out for potential red flags such as:

1. guarantees by a company or person, that if you pay a few thousand dollars up front, you will get a loan modification quickly;
2. the company claims to have an unusually high success rate for their clients;
3. the company makes promises about how much they can lower your monthly payments;
4. the company tells you to make your mortgage payments directly to the company, rather than your lender;
5. the company offers to fill out paperwork for you, or otherwise pressures you to sign paperwork you haven’t had a chance to read thoroughly or that you don’t understand; or
6. the company’s advertisements make promises that seem just too good to be true.

Chances are if the program has one or more of these red-flags, it could be a loan modification scam.

It is illegal in Massachusetts for a business or individual to solicit payment of advance fees for loan modifications or other foreclosure avoidance services. The Attorney General’s Office issued regulations in 2007 that prohibit predatory, for-profit foreclosure rescue transactions and other foreclosure-related services. (940 CMR 25.00: Foreclosure Rescue Transactions and Foreclosure-Related Services).

The AGO has a list of several resources available to you on our website including 17 organizations funded through AGO grants to provide financial education around these and other issues. If you think you may be the victim of a loan modification scam, contact the Public Inquiry and Assistance Center at (617) 727-8400.

Renting In Massachusetts?

May through August are traditionally busy months for the property rental industry in Massachusetts. Students at many of Massachusetts’ 122 colleges and universities will be heading home for the summer or looking for a new place to live during the next school year. Whether you are coming or going, or are a renter or a landlord,  you  need to be aware of your rights and responsibilities under the law.  You can find more information in our brochure and several one-page guides to renting an apartment in Massachusetts. 

In addition to the rights and responsibilities that come with paying rent and maintaining property, the Attorney General’s office enforces fair housing laws.  If you feel that you have been discriminated against at any point, or you have a question about your rights as a tenant  contact the Attorney General’s Office.

AGO Awards over $1 Million In Abandoned Housing Rehab Grants

The Office of the Attorney General is pleased to announce its Abandoned Housing Initiative Grant Program has awarded over $1 million in grants designed to assist some of the areas in the Commonwealth hardest hit by the affects of foreclosure and the abandonment of residential properties. Nine Massachusetts community development corporations and municipalities who are on the frontline of the foreclosure  crisis will receive grants of up to $150,000 to supplement existing abandoned property rehabilitation programs. Funding for the programs stems from a settlement obtained by the Attorney General’s Office against Fremont Investment & Loan and its parent company, Fremont General Corporation. For more information on the Abandoned Housing grantees or other AGO grant programs, visit the AGO website.

Discriminatory Ads Know No Hospitality

With more and more renters in the housing market, the prospect of finding an apartment can be daunting for anyone.  For some prospective tenants, navigating the web for rental listings revealed more doors for rental opportunities closed to them than open due to the posting of blatantly discriminatory advertisements that forced them to search elsewhere. 

Recently, the Attorney General’s Office (AGO) reached settlements in 20 cases against landlords and real estate agents in seven counties across the Commonwealth accused of violating state anti-discrimination laws by making discriminatory statements in rental advertisements on the popular website Craigslist.org (Craigslist).  The Attorney General’s Office also filed lawsuits against six other defendants based on similar allegations.  The settlements and lawsuits were the result of a statewide investigation into reports of widespread discriminatory Internet advertising.  Under Massachusetts law, it is illegal to discriminate against someone because the presence of children might trigger a property owner’s duties under the lead paint laws or because someone receives a housing subsidy, such as a Section 8 voucher, to pay for some or all of their rent.
 
In an effort to prevent future discrimination against families with children and against recipients of housing subsides. the AGO is also issuing two advisories to provide information and guidance to tenants, landlords, property owners and real estate companies about housing discrimination laws. 

To prevent this type of blatant discrimination, the Attorney General will continue to monitor Craigslist and hold accountable those who post discriminatory ads.

For additional information on lead paint discrimination and housing discrimination as it pertains to tenants receiving housing subsidies, please visit the Civil Rights section of the Attorney General’s website.

Attention First Time Homebuyers: Don't Miss Out On $8,000 In Savings!

If you are a Massachusetts resident and are thinking about buying your first home, you may be eligible for a tax credit under the American Recovery and Reinvestment Act of 2009.  If eligible, you can receive a tax credit equivalent to 10 percent of the home’s price up to a maximum of $8,000.  This great opportunity expires soon, so here’s what you need to know:

Eligibility:

• You must close on a home between January 1st and November 30th, 2009.
• You and/or your spouse cannot have owned a principal residence in the past three years prior to purchase.
• Your income must be $75,000 or less if you are single or $150,000 or less if you are married.

Terms:

• The tax credit will not have to be paid back as long as you reside in the purchased residence for at least three years after the purchasing date.
• You must file the credit on your tax return in order to claim it.
• The credit is claimed by filling out Form 5405.
• If you owe less than $8,000 in total taxes, you will receive a government refund.

MassHousing and some other state housing finance agencies and non-profit organizations can assist you by supplying short-terms loans to allow you to access the tax credit money before filing 2009 tax returns.  Homebuyers will have principal and interest payments on these loans deferred until the loan due date of June 1, 2010.  If not repaid on time, the loan will be amortized for 10 years at the same interest rate of your first mortgage loan.  (For more information call 888.843.6432 or visit www.masshousing.com).

For additional information, visit the IRS Information Center.

AGO Announces Community and Youth Development Grants

Yesterday, the AGO launched three new grant opportunities totaling $4 million that will support jobs for youth at risk, provide support to reclaim abandoned property and will work with families at risk for losing their homes to foreclosure. The funding for the grants stems from several settlements that were obtained by the Attorney General’s Office as a result of recent enforcement actions against pharmaceutical giants Merck Vioxx, Eli Lilly and Pfizer and against Fremont Investment & Loan. All grant programs have an expected start date of January 4, 2010.

$1.5 million will go to support Project YES, a youth employment program derived from the AG’s work as co-chair of the Governor's Task Force Anti-Crime Council's Subcommittee on Urban Violence. The Project YES: Employment, Health and Wellness program will provide low-income youth with jobs that have specific physical activity components.

An additional $1.5 million for Abandoned Property Rehabilitation grants stems from the Attorney General’s settlement against Fremont Investment & Loan Corporation. This funding will assist Massachusetts community development organizations and non-profit housing groups to rehabilitate abandoned properties and create more safe and affordable housing.   

Finally, $1million will towards the Financial Literacy Education Grant Program. This funding also stems for the AG’s settlement with Fremont Investment & Loan Corporation and will support consumer and community programs in providing direct consumer outreach, education and related services to help homeowners recognize and avoid predatory lending practices and avoid mortgage foreclosure. Funding will also support borrower protection services, including legal representation by qualified legal services organizations, of individuals who are at risk to losing their homes due to fraud, misrepresentation or other unfair, deceptive or predatory lending practices.

For more information on these programs check out the Attorney General’s website.