State Attorney General Cites HLAB’s Suero v. Freddie Mac Case to Protect Homeowners

The Latest from HLS Clinical Programs 2014-05-23

Nicole Summers, J.D. '14

Nicole Summers, J.D. ’14

On December 10, 2013 HLAB student Nicole Summers, J.D. ’14 argued a preliminary injunction in the U.S. District Court to prevent the eviction of Mr. and Mrs. Suero and their three children and halt the sale of their home. Citing a 2012 Massachusetts law – which made it illegal for any lender to place limitations on selling homes back to foreclosed homeowners – Nicole successfully prevented the eviction of the Sueros and sale of their family home. The law was intended to help homeowners repurchase their homes after foreclosure.

Nicole wrote about her case in an earlier blog post. “I am encouraged and hopeful that the judge’s decision will lead to meaningful enforcement of this important law. It was exciting and challenging to argue in federal court, and it was a wonderful experience to do so on behalf of the Sueros, who have fought so hard to remain in their home and rebound from the foreclosure crisis,” she said.

The battle, however, continues as Freddie Mac has refused to sell the home to a non-profit, which would sell the home back to the Suero family. Earlier this month, the Boston Globe ran a story ‘Can Freddie Mac skirt Mass. consumer law?’ It explains this contradiction in the law and how it has affected the Suero family.

In a press release issued a day later, State Attorney  General, Martha Coakley – citing Nicole’s case – urged the Federal Housing Finance Agency (FHFA) to use the  buyback programs to help homeowners. In a letter to FHFA, she states that the prohibition on selling the homes back to the homeowners is in direct conflict with the 2012 Massachusetts law.

“To date, [Fannie Mae and Freddie Mac] have not complied with this provision, which has unfortunately  impeded the ability of buyback programs to maximize the number of borrowers they can assist, which in turn has hindered the broader goals of neighborhood stabilization and revitalization,” AG Coakley said. “Our office is considering all available legal avenues, including litigation, to ensure compliance with Massachusetts law, should FHFA fail to promptly amend its policies to allow Fannie Mae and Freddie Mac to participate in credible buyback programs.”

Nicole’s case is the first case in Massachusetts to obtain an injunction against Freddie Mac on the basis of their refusal to comply with the 2012 Massachusetts law.

Mr. and Mrs. Suero are active members of a local anti foreclosure and anti-displacement organization, City Life Vida Urbana, as well as Local 26 Unite HERE. Both groups have been instrumental  in mobilizing residents to protest Freddie Mac’s refusal to sell homes back to former owners after foreclosure.  Nicole and others at HLAB have worked closely with the movement throughout the case and will continue to do so in the coming months with the goal of effecting policy change at Freddie Mac.