Many years ago, I was a collector/liquidator for a small bank. Somewhere in my memory I remember a statute or policy, (not sure which now) that if a person causes a substantial loss to the Bank on a previous mortgage (foreclosure deficiency), the Bank can refuse an application for a mortgage based on the fact the individualist caused the bank's loss. FYI- they did not repay it, the statute of limitations has passed on the deficiency, and they did not file bankruptcy. And they more than qualify now for a mortgage.

Does anyone have a similar policy, or is there a Mass Statute I can rely on?
Thanks.

I am not sure why this would be codified in State law. You are free to deny anyone a loan under the Federal rules for poor previous loan performance. There is no timeframe or statute of limitation for that, even though it may have dropped off of their credit report.

That makes sense, thank very much.