The lawsuit was filed Monday in
Coakley said the law has worked in
The 2012 state law explicitly forbids banks and lenders from refusing to consider offers from legitimate buyback programs merely because the property will be resold to the former homeowner.
Coakley pointed to a one buyback program,
The organization buys foreclosed, bank-owned homes at their present market value and sells the properties back to the original homeowners if they qualify for affordable financing. Coakley said the
The CEO of
In the complaint, Coakley alleges that two of FHFA's policies violate state law.
One of the policies intended to keep Fannie and Freddie in an "arm's-length transaction" prohibits property sales to nonprofits who resell to the original homeowner.
A second "make whole" policy prevents Fannie and Freddie from accepting anything less than the outstanding loan amount from the former homeowner or anyone seeking to resell or rent to the former homeowner.
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