Kennedy to consider suspending homeowner foreclosure ordinance

LYNN – A Boston law firm representing the Massachusetts Bankers Association is asking Mayor Judith Flanagan Kennedy to suspend enforcement of the city’s foreclosure ordinance, the Homeowners Bill of Rights.”My prediction came true,” said Kennedy during Wednesday’s mayoral debate with challenger and City Council President Timothy Phelan.Kennedy vetoed the ordinance last spring, not based on sentiment but because she feared it would lead to lawsuits, she said.Phelan said the missive from Goodwin Proctor, a Boston-based a law firm, is not a lawsuit.”It’s a letter saying please don’t enforce this,” he said. “We don’t not do something because of fear of failure.”Phelan, along with Ward 6 Councilor Peter Capano, spearheaded the ordinance that is designed to force big banks to sit down with homeowners for a mediation session prior to filing a foreclosure with the Southern Essex District Registry of Deeds. It does not force the banks to accept or not accept an agreement but it does require they meet, Phelan explained back in April.Although it was passed enforcement of the ordinance has been in limbo largely because there is no one in place to do the actual mediation, according to city attorney James Lamanna. But there are about 20 homeowners seeking mediation under the ordinance, he said.According to the letter sent by Brenda Sharton, the Boston firm is asking the city to hold off on enforcement until the First Circuit Court of Appeals rules on a similar ordinance involving the city of Springfield.”The MBA previously has expressed its significant concerns with the ordinance purporting to establish a “Bill of Rights” for homeowners in the city of Lynn,” reads the letter. “The ordinance in fact alters dramatically the traditional relationship among lenders, property owners and the government, and places substantial burdens on all lenders making mortgage loans in the city.”The letter goes on to state that the ordinance is entirely inconsistent with the state’s “carefully drawn statutory scheme, second guesses and frustrates the legislature’s considered intent to balance the rights and responsibility of lenders and borrowers,” and is fundamentally inconsistent with state law.”Accordingly it should not be enforced,” Sharton writes.Phelan said it is no surprise that banks don’t want the ordinance but that it already passed muster in Springfield so the city should enforce it.Springfield did pass one court challenge but Easthampton Savings Bank, Chicopee Savings Bank, Hampden Bank, United Bank, Monson Savings Bank and Country Bank for Savings are seeking a reversal of the initial ruling by the U.S. District Court that upheld the ordinance.Sharton is asking Kennedy to hold off on enforcing its ordinance until the appeal is decided.Kennedy did not say for certain she would abide by Sharton’s request but she did state that she is thinking about it.”I will be discussing suspension with the law office,” she said Thursday.