The U.S. Court of Appeals for the First Circuit recently held that the cancellation of a foreclosure sale prohibits a borrower from obtaining a permanent injunction to bar a foreclosure, as they would not suffer irreparable harm.
A copy of the opinion is available at: Link to Opinion.
In 2005, the plaintiff borrowers obtained a refinance mortgage loan on their home. The borrowers defaulted on their mortgage in 2007 and again in 2009. The loan was modified but the borrowers still had not made a mortgage payment since 2009. Between 2011 and 2013, the borrowers negotiated to again modify the loan. The negotiations were unsuccessful and a foreclosure sale was scheduled for September 2013.
The borrowers then filed an action in state court and obtained a preliminary injunction barring the foreclosure sale from moving forward. The foreclosure proceedings were subsequently cancelled, but the borrowers’ lawsuit remained pending.