Make Them Produce the Note to Delay Foreclosure

Home Buying News - February 25, 2009 -- Homeowners who are trying to prevent foreclosure can ask their lenders to produce the original promissory note for the home loan. It's a delay tactic that can help homeowners get caught up on their mortgage payments, thereby avoiding foreclosure.

Many homeowners facing foreclosure will be uttering the phrase produce the note in the coming months. Why? Because it's a way to possibly delay the foreclosure process until you can get caught up with your mortgage payments, and you can learn all about it right here.

Chris Hoyer of the Consumer Warning Network is the man most responsible for this rising trend. The Florida lawyer has spearheaded the grassroots effort to educate homeowners on this tactic to delay foreclosure, and he even provides the necessary paperwork through his website (www.ConsumerWarningNetwork.com).

How It Works

Asking your mortgage lender or loan servicer to produce the note won't magically absolve you of your debts. But it could buy you some time and stall the foreclosure process, giving you a chance to get caught up on your mortgage payments.

Why It Works - The Life of a Promissory Note

When a primary lender makes a home loan, they will often turn around and sell the loans through the secondary mortgage market. Without going into the financial feeds, suffice it to say that the lenders package the loans and sell them off to secondary mortgage buyers such as Freddie Mac. These mortgage-backed securities can be bought and sold numerous times.

Because of this, the original promissory note (that you signed during the closing process) can be extremely hard to track down. So when you tell your lender or loan servicer to produce the note, you are giving them a time-consuming task they must perform.

Why must they perform this task? Because a lender cannot foreclose on a home until the process gets approved by a bankruptcy judge. If you file a request to have the lender produce the note for your mortgage loan, the legal proceeding will typically be delayed pending the search and presentation of that note -- and that could take weeks or months.

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