SPRINGFIELD, Mass. (AP) — A federal judge on Tuesday upheld two Springfield anti-foreclosure ordinances, ruling against six banks that sought to overturn the regulations.
U.S. District Judge Michael Ponsor dismissed a lawsuit filed by the banks, finding that the ordinances do not violate any state law or the U.S. Constitution.
The banks sued after the Springfield City Council passed the ordinances last summer. One will require mortgage lenders to engage in mediation with homeowners in danger of foreclosure or face a $300-per-day fine. The other will require lenders to put up a $10,000 bond to secure and maintain their foreclosed and vacant properties.
Advocates said the measures will help people stay in their homes and fight urban blight.
The banks argued that the ordinances conflict with existing states laws and that the bond amounts to an illegal tax.
Ponsor disagreed with the banks, including Easthampton Savings Bank, Chicopee Savings Bank, Hampden Bank, United Bank, Monson Savings Bank and Country Bank for Savings.
"The modest effort made by the city to soften this crisis through the promulgation of the two ordinances violates no Constitutional provision or state statute," Ponsor wrote.
Springfield, a city of about 150,000 in western Massachusetts, has been hard hit by the housing crisis. The number of foreclosure deeds filed in the first four months of the year was up from 104 in 2011 to 175 this year.