FindLaw's Common Law

Consumer protection legal news from FindLaw.com.




July 2014

Sun Mon Tue Wed Thu Fri Sat
    1 2 3 4 5
6 7 8 9 10 11 12
13 14 15 16 17 18 19
20 21 22 23 24 25 26
27 28 29 30 31    

FindLaw Blogs


FindLaw Blotter
Free Enterprise
Injured
Law & Daily Life


If you're looking for information on common law marriage, please visit the Common Law Marriage section on FindLaw.

« Model Monika Zsibrita Says Not a Gold Digger, Gets Lawsuit Against Chris Rock Unsealed: Did Rock Open Up This Can of Worms? | Main | State of Washington 'Death with Dignity' Act Goes Into Effect Thursday »

Produce the Note: Foreclosure Delay Tactic Can Encourage Lenders to Negotiate

Homeowners facing foreclosure are receiving a simple piece of advice to help stall foreclosure: make the other side "produce the note." As it turns out, many lenders seeking to foreclose seem to have lost track of the original promissory notes for the mortgages in question. Though by no means a long term solution, forcing the lender to produce the note can delay foreclosure proceedings and give the lender increased incentive to negotiate.

While securitized bundles of toxic mortgages have been blamed for much of our current economic malaise, there is one bright spot they offer to some homeowners facing foreclosure. When their original lender sold off their mortgage, and it got packaged, sliced and diced into securities sold all over the world, many times the original promissory note got lost in the shuffle.

Along with others, the Consumer Warning Network is actively pushing the "produce the note" strategy as an effective means of delaying foreclosure and creating additional incentive for lenders to renegotiate payment terms.

As described in Consumer Warning Network's How-To, the strategy works as follows:

  1. After you receive notice of a foreclosure suit from a lender who claims to own your mortgage, you file a request, with the court, for production of the original promissory note.
  2. If the lender does not respond in 30 days, you file a motion to compel production of the note. This is a request that the judge order the other side to produce the note.
  3. Most often there will then be a hearing where the judge will decide whether to force them to produce the note or not. Should you win, the lender can't foreclose until they produce the note (which could prove very difficult for them). Should you lose, you would still have had the extra time in the home and perhaps the opportunity to negotiate with the lender.

Consumer Warning Network's How-To includes free forms for requesting production of the promissory note, and also for filing a motion to compel. The group warns against scams offering "produce the note" forms for a fee.

Consumer Warning Network cites an increased tendency in judges to hold lenders to the letter of the law in the surging number of foreclosure cases, including the New York Times report of an Ohio federal judge who threw out 14 cases in 2007 when investors trying to foreclose could not prove ownership. April Charney, head of foreclosure defense for the Jacksonville, Florida Area Legal Aid also uses and strongly advocates the "produce the note" strategy. As reported in the Florida Union Times, she says that for some of her clients, it has put foreclosure on hold for years.

TrackBack

TrackBack URL for this entry:
http://www.typepad.com/services/trackback/6a00d83451609d69e20111689d4515970c

Listed below are links to weblogs that reference Produce the Note: Foreclosure Delay Tactic Can Encourage Lenders to Negotiate:



Subscribe



Archives




Common Law Vanguard Panel

The following firms have assisted the FindLaw editorial team in identifying emerging trends in consumer protection law and topics of importance to readers of this blog: