SECTION 1. Chapter 244 is hereby amended by inserting after Section 1 the following section:-

Section 2: Foreclosure by Action: All foreclosures of residential mortgages on 1-6 family owner-occupied properties shall be initiated by the filing of a foreclosure complaint against the mortgagor in the Superior Court for the county or district in which the property is located. In addition to applicable rule, if service is not effected in hand, then it must be effected by both posting and mailing.

A defendant-residential mortgagor may raise all legal and equitable claims and defenses against the mortgagee or any predecessor in interest, assignee, agent or any person or entity acting on behalf of such mortgagee. The court shall have the authority to modify the mortgage or grant any other appropriate relief as to the mortgagor but nothing in this section shall affect the rights of tenants or any legal occupants residing in the property that is the subject of the complaint. The court may set aside a default judgment for good cause shown.