Attorney General Martha Coakley regaled the benefits of proposed legislation to prevent foreclosures today to a group of 200 real estate agents, mortgage brokers, attorneys, home inspectors and property managers at the North Shore Association of Realtors’ annual Membership Meeting and Business Expo in Peabody.

The proposed legislation requires creditors take reasonable steps to avoid foreclosure and prohibits foreclosures without appropriate documentation, according to a statement. The legislation would also prevent additional foreclosures by mandating loan modifications in certain circumstances.

"Our communities have been devastated by the housing crisis," said Coakley. "The proposed legislation will help rebuild our communities by promoting a process in which creditors and borrowers work together. Requiring creditors to take reasonable efforts to avoid unnecessary foreclosure is in everyone’s best interest."

The legislation targets loans generally considered to have a higher risk of default. Under the bill, creditors are required to have appropriate documentation that supports their right to foreclose prior to beginning foreclosure proceedings and are prohibited from passing on certain fees and costs associated with foreclosure to homeowners.

The legislation, entitled "An Act to Prevent Unnecessary and Unreasonable Foreclosures," is sponsored by Sen. Karen Spilka (D-Ashland) and Rep. Steven M. Walsh (D-Lynn).