Foreclosure Fighting Words: ‘Produce the Note’
By: Diane Tuman, Content Manager | June 24, 2008
Here’s an interesting tactic that Chris Hoyer, an attorney who advises consumers about foreclosure on Consumer Warning Network, is suggesting: tell the banks to “produce the note.”
What this means is that if you are in foreclosure trouble, and the bank or lending company threatens to take your home, you can buy some time and possibly renegotiate a new mortgage (without tacked-on fees) if you ask the bank to “produce the note.” Evidently, in a large number of cases, banks are having a tough time producing the promissory note since mortgages are packaged up, sold, bundled again, and re-sold and the original promissory note gets lost in the process.
In this CNNMoney video titled, “New Way to Fight Foreclosure,” reporter Greg Hunter has a clip with Hoyer’s mantra, plus a snippet by University of Iowa law professor Katherine Porter who says, “banks fail to attach a copy of the promissory note in 40% of situations” and that 4 out of 10 consumers are being asked to make payments for the mortgage, but the bank didn’t provide evidence to establish what those debts were.
So, if you face foreclosure, don’t abandon your property and move out. All is not lost. Get a lawyer and make sure the bank “produces the note.”
- Stumble it!
- Categories: Mortgages
Comments
20 Comments so far
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Overland Park Real Estate on June 24, 2008 10:11 am
Oh, OK, Foreclosure crisis solved. That was easy. Ignore the mortgage filed at the court house…meaningless. Dont worry that the borrower still cant afford the house….irrelevant.
Sven Goran on June 24, 2008 12:53 pm
The above comment is disturbingly biased. The “produce the note” tactics gives borrowers time and leverage to fight and save their home. What is going on at the moment and what monsters such as Countrywide are doing has to be countered and this is a viable way to do so! Make them “produce the Note”!
consumeradvocate on June 24, 2008 1:01 pm
Overland Park Real Estate misses the point. People were mislead into predatory loans, which is, in many cases, the primary reason for their default. In addition, repeated efforts by borrowers to work out payments for their mortgages are met by a brick wall from the loan servicers. They drag it out and pile on unfair fees and penalties increasing the arrearage to exoribitant amounts by their delay tactics. Then, they try to steal the borrowers home without proof that they own the loan. Yeah, I think they should have to prove they have a right to foreclose. It’s only the law. I guess that doesn’t really matter, does it? At the very least, they owe that borrower an ounce of effort to renegotiate a fair loan. This will work to put pressure on the lenders and servicers, if enough people use this strategy. It’s time for a grass roots effort to fight back against unscrupulous mortgage companies!
Produce the Note - Early Retirement Forums on June 24, 2008 2:10 pm
[…] Produce the Note Interesting tactic: Foreclosure Fighting Words: ‘Produce the Note’ | Zillow® Blog […]
Overland Park Real Estate on June 24, 2008 10:23 pm
You missed my point. I feel for people who were victims of predatory lending and they should be able to renegotiate a better rate or program if they qualify. My sarcasm was towards CNN who made this seem like some miracle golden ticket to Willy Wonkas factory. A lot of people are buried in their home, how they got to that point can be for a lot of reasons but the fact that they can stay in the house for a couple extra months is not going to help the majority of people in foreclosure keep their home. The few who can renegotiate a better deal yes, but the fact of the matter is that a lot of these interest only programs that went through buried people in their homes and even if the borrow could qualify now with a 6.5% interest rate, they still could not afford the payment now that they would be paying interest and principal.
Responsible Borrower on June 24, 2008 10:26 pm
Hey ConsumerAdvocate: What it’s time for, is a grassroots effort to fight back against unscrupulous borrowers. You signed for it, you’re responsible for your commitment. Oh and by the way: It’s not “…the borrower’s home…”. Until you pay off the note, it’s the bank’s home.
What the banking community should be (and hopefully is) doing is to protect responsible borrowers by compiling a list of every borrower who stiffs them with a tactic like this, or trashes the house before abandoning it, and use that list to screen and blacklist future borrowers. That would protect the lenders, and the responsible borrowers as well.
Rhonda Porter on June 25, 2008 7:29 am
What’s wrong with someone fighting for their home if they have found means to afford it. Maybe the reason they fell behind was they were unemployed for a spell and now they are more secure again. Maybe they’ve taken on a room-mate. If someone can afford their home, they should fight for it. And most important, they should contact their lender and an attorney early on—ignoring a pending foreclosure has guaranteed results.
consumeradvocate on June 26, 2008 8:02 am
Responsible Borrower must be living under a rock. Maybe you’ve missed the fact that lenders and servicers like Ameriquest, Countrywide, Bear Stearns-EMC and so many others have committed out and out fraud in many cases tricking borrowers into these loans. The FBI is investigating and just yesterday the Attorneys General in Illinois and California filed a major suit against Countrywide for these despicable practices. If the lenders and servicers didn’t get so horribly greedy our country wouldn’t be in the mess that we are now. And make no mistake, we’re all in the mess. Just check your property values. It was a corporate culture of greed that drove this meltdown and they did it on the backs of borrowers they mislead. Perhaps, “Responsible Borrower,” you’re one of those fine people who mislead so many into taking a loan they couldn’t afford. Yeah, it’s time to fight back. Angelo Mozillo is still sitting pretty and tan in his mansion. It’s time for the lenders and services to fix the problem they created.
Responsible Borrower on June 26, 2008 8:31 am
Consumer Advocate: Actually I’m a salary man, who’s worked since the age of 12 and doesn’t have anything to do professionally with the banking, lending, mortgage or real estate businesses.
Let the FBI investigate who it will, and more power to ‘em for bringing to justice those in those industries who committed fraud. So long, of course, as the enforcement community also investigates and aggressively brings to justice the borrowers who have committed fraud.
Frankly, I don’t care about either the banking and mortgage industry, or the consumers. What I care about is that their actions don’t hamstring me and my family who’ve played straight over the years in paying our notes.
People are responsible for their own actions, whether you’re a lender or a borrower. So don’t go whining about “consumer fraud”. All of us, as consumers, are responsible for our own due diligence. You signed the note, and now you’re whining about “fraud” and trying to get the lenders or tax payers, or both, to bail you out for your ignorance and/or stupidity.
Maybe the “consumer advocates” and the people they represent are the ones who should be investigated next for fraud.
consumeradvocate on June 26, 2008 10:17 am
Responsible Borrower, there is no point in getting involved in a tit for tat here. There is important information in this post for homeowners who are facing foreclosure. I’m sorry to see that your understanding of the problem is somewhat limited, but so it goes. We are all entitled to our opinion. I wish you the best.
steve on July 19, 2008 4:49 am
Anyone know how this might help if your home was already taken before this information was made available?
Thanks
David Gibbons on July 19, 2008 6:46 pm
Sorry Steve, I don’t; best ask a RE attorney.
Robert Davison on July 30, 2008 11:10 pm
I was told I had a 30 year fixed loan and was completely lied to by my lender. Then 2 years later I get this letter that my tpayment for my tiny 1300 sq ft house here inLas vegas was going from $2,000 pr mo to $2,600 per mo. At that exact time I also lost my job. My loan was transferred twice without my signature or consent. I am going to fight these bastards because their predatory lending practices and greed screwed me and my family. I WILL MAKE THEM PRODUCE THE ORIGIONAL PROMISSORY NOTE. i WILL NOT LEAVE MY HOUSE. PERIOD!!!!
troyusaguy on August 4, 2008 10:09 am
All mortgages that originate from a fraud should be null and viod and home owner keeps the home. When the loan was created-the money was never in existance, it was created out of thin air and no “consideration”. The only value the mortgage provides is the signatures of a borrower willing to be enslaved, there is no money, just a credit issued. Its quite mind boggling, google Jerome Daly, he proved this in a court. Its these corrupt bank practices that are ruining our country and enslaving people through debt.
Make them produce the note and fight them tooth and nail.
Rusty Payton on August 20, 2008 8:24 pm
I am an attorney in Chicago. A Countrywide client only 3 months behind just came to me with a loan modification agreement that CW just sent him (out of the blue without request). CW offered to put the three loan payments on the principal, reduce the rate to 5.5% and extend the term. Oh, and they want him to state that
“…if any document related to the …Note…is lost, misplaced, mistated…..” borrower will waive that fact.
Has anyone else seen this? Is the fear starting to creep in? What should my client do?????
Mark Gaddis on September 18, 2008 8:41 pm
Some of you are missing some very important facts to this tactic. They are only asking for the party that is filiing foreclosure to prove they have the right to foreclose. It is a matter of law and holding the lender to the letter of the law. If you feel sorry for them your feelings of sympathy are misguided.
For once the consumer can have the laws work in their favor and maybe use it as a leverage to get the lender to offer a reinstatement or payback program the consumer CAN afford.
Michael Adams on October 13, 2008 4:05 pm
Responsible Borrower is code for Republican, Ayn Randian, Virtue of Selfhishness, Screw the tired, the poor, the hungry and screw that limp wristed liberal Jesus too, “I don’t’ give a damn about anyone but myself because I’m a superior human being.”
You’re time is over and after the revolution you’ll be lucky if you even get into a low rent re-education camp.
National Audits on October 21, 2008 12:19 am
Rusty, as a condition of loan modification lenders typically ask borrowers to waive their rights and give up all causes of action or statutory defenses that may be available to them. This is why we perform a forensic audit and look for TILA violations before approaching the lender for a modification. More than 80% of the files we audit have actionable TILA violations! This means most people who refinanced within the past three years have a right to rescind the loan and receive a refund of all finance charges and closing costs paid in connection with the loan.
The best way to fight back is by finding technical TILA violations that allow for rescission.
Woman Chains Herself to Her Home | Zillow® Blog on October 28, 2008 3:13 pm
[…] foreclosure? One consumer network says you should ask the bank to “produce the note.” I’m not sure if this will help this woman at this point, but it looks like she is […]
George Bekaert on October 29, 2008 10:14 am
AFFODABLE HOME LOANS.COM????
I refinanced at the peak in 2007, I cant today qualifiy for the same exact loan, this is another issue that will come about soon. People who want to recast a loan moving to a variable rate will not be able to qualify for the same loan they are in. Lenders have moved their debt to income ratio from around 62% down to 50%. If this doesnt mess up the scenario bad enough the home value has decreased.
So now you will not just have to have a second job but you will have to come to the table with the difference, in my case this would be 50,000 less my house is worth. We had these types of loans for 15 years and nothing went wrong and still nothing has gone wrong with interest only loans as of today. Except for the fact the lenders have been hit with bad times from some forclosing on their homes. So they do what? they make it even harder to get the loan that you will need when your fixed rate term comes due. Now more than ever we need to have a way
to recast our current loans without meeting their belt tightening tactics that will cause even more foreclosures. Personally I think we could stop all this madness by creating a one at a time home loan issued on your social sucurity number financed by the taxpayers with the interest going to the taxpayers in form of relaxing taxes due. Borrow the money from ourselves, and pay the interest back to ourselves. The 7 billion bail out should start the new program. We in america cant afford to be paying 3 and a half times the puchase price for our homes.
we need to loan ourselves the money and offer a 4% fixed rate for 40 years to each social security number.No current qualifing as long as you have a current home loan. This would keep almost every home out of foreclosure. Private lenders cans still keep their business lucrative by reducing overhead and loaning to people with second homes and investment properties,businesses and such. We as ameicans deserve to work and prosper.Get it right you politicians and so called leaders. We want to prosper, not be victims of the economy. Since the inseption of the housing problem we humans have spent enough time equalling money ponering, talking and working on clerical tasks to have paid for all homes in foreclosure today. Work smarter not harder, save humanity and never make housing,health care and jobs an issue. Spend your energy us taxpayes are paying you hansomly to do something right for a change. If lenders and government can pull monies out of thin air we can create these types of loans for all americans and by the way more people will stop renting and start buying with a real loan.