In a Boston Globe story, BlueHub Capital announced that it is pausing its shared appreciation mortgage program across the 11 states where it operates, citing legal uncertainty stemming from an ongoing Massachusetts court case.
The Globe story outlines how a Suffolk Superior Court judge ruled in August that a recently enacted state provision shielding nonprofit shared appreciation mortgages from legal liability does not apply retroactively. This ruling affects a lawsuit filed in 2020 and funded by the Neighborhood Assistance Corporation of America (NACA).
BlueHub launched the program in 2009 to help homeowners avoid foreclosure by repurchasing their homes with reduced principal and payments, paired with a future appreciation-sharing agreement. More than 750 families have participated nationwide, including nearly 450 in Massachusetts. BlueHub says the program has helped stabilize households whose homes were worth less than their mortgage balances.
CEO Elyse Cherry shared with the Globe that the pause is temporary but necessary until the legal issues are resolved:
“What it means is that homeowners in foreclosure whose homes are not worth the amount of their mortgage have nowhere else to turn.”
While NACA has criticized the program, key borrowers interviewed by the Globe described it as essential in helping them remain in their homes and work with a responsive lender.
Read the full article in The Boston Globe.