Ban on home equity theft is now Massachusetts law. Here’s what the new law does [Video]

With the stroke of a pen Monday, Gov. Maura Healey banned cities and towns in Massachusetts from “equity theft,” the practice of selling a foreclosed home and keeping the former homeowner’s equity as profit.”This is huge,” said attorney Todd Kaplan with the Greater Boston Legal Services. “We’re thrilled,” said retired judge Frank Bailey, now with Pioneer Public Interest Law Center.The two have been working for years to stop the practice of cities, towns and even private companies foreclosing on homeowners, selling their properties and keeping the profits.They have represented people like Nancy Rodriguez of Worcester, who almost lost her $300,000 home over what started as less than $3,000 in unpaid taxes.With the budget amendment now signed into law, if a city or town forecloses on a home and sells it, whatever remains of the equity after the tax is paid off must be returned to the former homeowner. That could …