Under Massachusetts law, a foreclosing mortgagee must do more than comply with the procedure prescribed by statute for more information click here.
A disparity between the foreclosure sales price and fair market value is not sufficient of itself to invalidate a foreclosure, but such disparity plus other circumstances can be. The Supreme Judicial Court of Massachusetts has on several occasions avoided a foreclosure sale when sufficient circumstances were present. For example, in Bon v. Graves, 216 Mass. 440, 103 N.E. 1023 (1914), the mortgagee chose to place the required legal notices in a newspaper which had a more limited circulation than five other local newspapers. And, although he knew that two owners of nearby properties were interested in purchasing the mortgaged property, he gave them no personal notice of the sale. Nor did he give notice of the sale to the plaintiff, who held a second mortgage on the property. The property sold at foreclosure for $2,900, much less than its fair market value of at least $5,000. Chief Justice Rugg, writing for the court, held that the inadequate price, combined with the other circumstances, invalidated the foreclosure. In Sandler v. Silk, 292 Mass. 493, 198 N.E. 749 (1935), property worth $7,800 was sold at foreclosure for $1,200, subject to a small first mortgage. Having given the required personal notice to the owner and notice by publication, the mortgagee gave no personal notice of the sale to the plaintiff, an attaching creditor, despite the mortgagee's promise to do so. After ruling the plaintiff was not entitled to notice beyond publication, the court stated: "Nevertheless, the fact that in these circumstances no notice was sent to the plaintiff is evidence that good faith was not used to obtain the best reasonable possible price." The court held there was sufficient evidence to support the finding for the plaintiff made below and affirmed the damage judgment entered by the trial court. See also Union Market Nat Bank v. Derderian, 318 Mass. 578, 62 N.E.2d 661 (1945) (sale invalidated because of inadequate price and auctioneer's unadvertised requirements that potential purchasers must deposit $ 1,000 to qualify as bidders); Kavolsky v. Kaufman, 273 Mass. 418, 173 N.E. 499 (1930) (affirming verdict for defendant in mortgagee's deficiency action because property sold for 42,400 after auctioneer re-deposit rather than the more usual deposit of $200.); Clark, 150 Mass. at 360-61, 357, 23 N.E. at 108-069 (invalidating $1,200 foreclosure sale where property's value was at least $1,400 and mortgagee did not give junior mortgagee personal notice of sale despite a request for such notice).
In the present case, there is strong evidence the Bank did not use reasonable diligence to protect the Debtor's interests. The sales price of $86,500 is only 45% of the property's $190,000 fair market value.
Moreover, Bank no attempt to ascertain the fair market value. Nor did it do anything to enhance the bidding beyond making its own bid at precisely the balance of its mortgage read more here.
Write something about yourself. No need to be fancy, just an overview.