How To Stop Foreclosure Now By Telling Your Bank To ‘Produce The Note’

Foreclosures are skyrocketing; families are being forced from their homes and in many cases, the banks forcibly kicking families out of their homes, do not have the legal right to do so! In fact, banks across the Nation are foreclosing on homeowners with no proof that they even have the right to take a payment from these homeowners whom they are foreclosing on!

In multiple cases across the country judges are stopping the foreclosure process cold! Most homeowners don’t know about the legal requirement that a bank must possess the Note, which is the legal document, signed by the borrower, outlining the terms of the loan. For those homeowners who know about this requirement, it can stop the foreclosure process indefinitely. It would seem to be a simple request, that the foreclosing bank produce the original Note on the borrower’s home, to show that they are legally entitled to collect the borrower’s money and foreclose on the borrower’s home if they can’t pay.

However, in the late 1990’s the banking industry got greedy. What a surprise. And instead of giving out loans and then collecting on them as had been done for many decades, the banks decided to give out the loans to homeowners and then turn around and sell the home loans to investors for an even bigger profit. The investors in these mortgages bought them in huge quantities, often buying $100 million, or more, in mortgage loans at a time. They would keep the loans for a short time until some other investor came along offering to buy them at a price that let the first investor make a substantial profit. And this game went on and on with the loans often sold to a new investor every year or two.

We all know this game collapsed in 2007 but how does this impact the distressed homeowner today, who is facing foreclosure? It’s very simple. The typical home loan was sold so many times the current investor and their servicing company has no idea as to the location of the original Note on individual loans. Even if they do have an idea as to the location of the original Note, it can often take them months to actually produce it in court.

The homeowner who is aware of this requirement is now in a very powerful position. If they are being foreclosed upon, they can demand the bank produce the Note and prove they have the legal right to collect money from the homeowner and instigate foreclosure proceedings.

A Federal Judge in San Jose, California stopped a foreclosure this Summer (Isabel and Richard Caporale, May 29, 2009), when the homeowners said “Produce The Note”, and Saxon Mortgage Services couldn’t produce the Note. This same process has played out in numerous courtrooms from California to Ohio to Florida and throughout the Nation.