Not in this case. On remand from the Supreme Judicial Court, the Appeals Court affirmed summary judgment for the bank on the former homeowners’ predatory lending counterclaim, because the bank gave up any claim for a deficiency, leaving nothing for the counterclaim to offset, and it held the bank’s judgment for possession still stands. This is an unpublished Appeals Court decision under Rule 23.0, which courts may cite as persuasive but not as binding precedent.
What happened
After foreclosing, the bank brought a summary process case in Housing Court to remove the homeowners and won a judgment for possession in 2018. The homeowners had counterclaimed under the Predatory Home Loan Practices Act (PHLPA) and G.L. c. 93A. In 2022 the SJC reversed summary judgment on the PHLPA counterclaim, ruled partly for each side on the c. 93A claim, and sent the case back. On remand, the Housing Court judge again granted summary judgment for the bank, because the bank had no claim against the homeowners for any amount still owed on the loan. The judge allowed the bank’s application for an execution for possession, denied reconsideration, and stayed the execution while the homeowners appealed.
What the court decided
The Appeals Court affirmed in HSBC Bank USA, N.A. v. Morris, No. 24-P-1073 (Mass. App. Ct. December 16, 2025) (Rule 23.0 decision).
Jurisdiction. The SJC had already rejected the homeowners’ claim that the Housing Court lacked jurisdiction. HSBC Bank USA, N.A. v. Morris, 490 Mass. 322 (2022). Their new arguments also failed. Their PHLPA counterclaim did not put title at issue, because any recovery was limited to money, fees and costs. And even if title had been at issue, the Housing Court would still have had jurisdiction. Bank of N.Y. v. Bailey, 460 Mass. 327 (2011). The Housing Court’s failure to docket the SJC’s rescript did not take away its jurisdiction, especially since the homeowners litigated for two years after remand without raising it.
Possession. The homeowners argued the SJC had wiped out the 2018 possession judgment. It had not. The SJC reversed only on the PHLPA counterclaim and part of the c. 93A claim, and nothing it sent back called the possession judgment into question. On remand, a trial judge must follow the appellate court’s decision on matters it addressed. City Coal Co. of Springfield v. Noonan, 434 Mass. 709 (2001). So execution on the possession judgment may go forward.
The PHLPA counterclaim. Under G.L. c. 183C, § 15(b), a borrower’s claims against a later holder of a high-cost home loan are limited to amounts needed to reduce or extinguish the borrower’s liability on the loan, plus costs and reasonable attorney’s fees. The SJC had said the homeowners could seek damages to wipe out their loan deficiency even though the bank had not yet sued for one. On appeal, the bank filed a letter stating it will not seek a deficiency judgment and that any ability to do so has expired. With no possible deficiency left to offset, the counterclaim had nothing to recover, and summary judgment was proper.
The court also noted that the homeowners never argued they could recover fees and costs without damages, and that several other arguments were already rejected in the earlier appeal or were waived because they were not raised in time.
What this means for you
A predatory lending claim under the PHLPA can be raised as a counterclaim when a lender or later holder tries to take your home. But under § 15(b), what you can recover from a later holder or assignee is capped at what it takes to reduce or erase what you owe on the loan, plus costs and fees. In this case, that meant the counterclaim could only offset the debt. It could not undo the foreclosure or bring extra damages.
That has a hard consequence. If the lender gives up any claim for a deficiency, there may be nothing left for the counterclaim to reduce, and the claim can fail. Meanwhile, a possession judgment that an appeal did not disturb stays in force.
The case also shows the cost of raising arguments late. Issues not raised in the first appeal or on remand may be treated as waived.
What to do now
- If you received a notice of foreclosure or a summary process complaint, get your loan documents together, including the closing papers.
- Have a lawyer review whether your loan may have been a high-cost loan under G.L. c. 183C.
- Raise every defense and counterclaim at the first opportunity, in the trial court.
- Understand what each claim can realistically recover, including any cap on damages.
- If you appeal, ask about a stay of execution so you are not removed while the appeal is pending.
If this is your situation, call Doubleday Law at (617) 575-2006 or tell us what happened. Housing Court deadlines are short.
