BK Judges in MA send a message to the Good People at Goldman etal

MASSACHUSETTS BANKRUPTCY COURT: NEW RULE FOR MORTGAGE MODIFICATIONS

by Nicholas Ortiz, Boston Bankruptcy Attorney on March 2, 2010 · Posted in *Bankruptcy Practice and Procedure

Today, the Massachusetts Bankruptcy Court issued a new, emergency standing order pertaining to mortgage modifications. THE ORDER VOIDS PROVISIONS IN PROPOSED LOAN MODIFICATIONS STATING THAT THE AUTOMATIC STAY WILL BE LIFTED OR WAIVED AFTER DEFAULT ON THE LOAN MODIFICATION PAYMENTS.
http://www.mab.uscourts.gov/pdfdocuments/so10_02.pdf

The order is an artful one: it will not stop mortgage companies from submitting mortgage modifications containing the forbidden terms, nor stop the Court from approving them. Instead, the terms pertaining to the automatic stay will just be void and unenforceable absent specific approval from the Court, which the Court appears to have no intention of giving.