Committee advances Sen. Carney bill to clarify protections against foreclosure

AUGUSTA – On Jan. 30, the Judiciary Committee advanced a bill from Sen. Anne Carney, D-Cape Elizabeth, to clarify protections against foreclosure in light of a decision by the Maine Supreme Judicial Court (SJC) in 2024. As amended, LD 1444 would be titled “Resolve, Clarifying the Application of Finch v. U.S. Bank, N.A.,” and prohibits a lender that lost a foreclosure case before 2024 due to its failure to comply with notice requirements from bringing a new foreclosure claim against that homeowner.

Under Maine law, lenders are required to send notice to homeowners in default at least 35 days before filing a foreclosure, including an itemized list of the dues to be paid to cure the default. Notice of default requirements are one of the few protections from foreclosure available to Maine homeowners and, accordingly, have historically been strictly enforced. To deter repeated, unlawful foreclosures, a ruling by the Maine SJC in 2017 reaffirmed the precedent that prohibits a lender from bringing future foreclosure claims against a homeowner after failing to comply with notice requirements.

In 2024, however, the Maine SJC reversed course in Finch v. U.S. Bank, N.A., decoupling enforcement of notice compliance from banks’ right to bring foreclosure claims against a homeowner. This decision put prior cases, resolved under a different legal framework, in doubt, threatening to upend settled property rights.

“Homeownership is a crucial pathway to long-term stability for generations of hard-working families. But the road to homeownership is all too precarious for many Mainers – one unexpected financial hardship, resulting in one missed mortgage payment, can precipitate the loss of one’s home,” said Sen. Carney. “If applied retroactively, the Finch decision puts in question the property rights of homeowners whose foreclosure cases have long been settled, unjustly exposing them to future foreclosure claims.”

As amended, LD 1444 seeks to ensure that homeowners whose cases were resolved before the 2024 decision continue to have the protections provided by the law in effect at the time of the foreclosure action. The bill aims to keep Mainers in their homes by ensuring homeowner rights are honored.

“Our concerns greatly increased in early 2024 when Attorney Cox advised us of the Maine Supreme Court decision in the Finch case and warned us that the mortgage servicer might try to use that as a basis to sue David again,” said Alison Jordan of Lisbon Falls in testimony before the Judiciary Committee, sharing her late husband’s story. “[I] hope you will vote to pass LD 1444 so that I and other Maine homeowners do not have to face these kinds of repeated foreclosure cases when the banks lose their cases.”

LD 1444 now awaits votes in the full Senate and House.

Sen. Carney is serving her third term in the Maine Senate, representing South Portland, Cape Elizabeth and part of Scarborough. She serves as Senate Chair of the Judiciary Committee and the Joint Rules Committee and as a member of the Inland Fisheries and Wildlife Committee.

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