CT HB05567

Establishes new procedures allowing mortgagees and mortgagors to modify underwater mortgages (where debt exceeds property value) and increase principal by accrued interest, fees, and costs without consent of junior lienholders, subject to court approval through a judgment of loss mitigation.

Permits mortgagors to transfer residential real property to mortgagees in satisfaction of mortgage obligations through executed transfer agreements, with junior liens terminated following court entry of loss mitigation judgment.

Requires courts to determine fair market value of properties and whether mortgages are underwater when considering loss mitigation judgments, with final determinations appealable and recorded with town clerks.

Allows mortgagors denied loss mitigation to petition for foreclosure mediation program inclusion if they did not substantially contribute to default, and permits mortgagees to proceed with foreclosure if mediation is denied.

Modifies foreclosure by market sale procedures to allow parties to enter listing agreements at any point during foreclosure actions, and expands mediator authority to excuse mortgagors from mediation attendance in cases such as marital dissolution or non-residency.