Lost Note Affadavit

[balzsand]

My home is currently facing foreclosure in approx. two weeks. We have the money to make regular mortgage payments, however, the bank (M&T) won't even talk to us, they refer us to their attorney, so there are not talks of options. We have to pay the past due amounts plus an huge amount of attorney fees. I believe we owe $20,000. The house is in my husbands name only and he avoided foreclosure by filing for bankruptcy two different times. Both times he didn't go to court for the initial hearing because he was out of town on business and didn't want his employer to find out. Not a smart move, I know. Anyway, it's an FHA loan and I considered trying to buy him out, however, no banks are willing to do anything since the it's considered a distressed mortgage. We are also in the process of getting seperated so I want to buy the house from him anyway, my son and I want to remain in the house even though our name isn't on the house itself. I need to come up with a way to pay the 20,000 to get the house out of the distressed status and then try to refinance. The house has tons of equity, we only owe approx. 100K and the market value of the house is 265K, however, due the status of being a distressed mortgage no one will touch the mortgage. Any suggestions? Again, my main goal is to keep the house, not let it go to auction, so that my son and I can remain in the house. He was set up on a loan modification, however, he sent the first check to the wrong mortgage company and then they said he didn't make the payment, which technically he didn't. I've been trying to handle everything but it's becoming quite difficult. Any advice? Do I have any options that I might be missing? Keep in mind my name isn't on the house but someone told me that I can file something with the courts to stay in the house but I'm not sure what it is. If I can get a loan or something just to get it out of the distressed status I think I will be okay because there is enough equity to pay the amount past due. Thanks.

[Moe]

Thanks for joining and sharing your story.

This is a real complicated one to say the least. You are definitely getting into the legal arena here, big time. I'm not sure if you can file something. Maybe an innocent spouse claim? I dunno. This is a new one for me and again, I am not a lawyer.

A lender under the FHA/HUD programs cannot begin a foreclosure proceeding until at least three full monthly payments are due. In these programs, the lender cannot foreclose if the only default is the borrower's failure to pay an escrow shortage in a lump-sum payment. Furthermore, lenders must provide notice of the default no later than the end of the second month after delinquency.

The lender must also make reasonable efforts to set-up or hold a face-to-face interview with the homeowner before three monthly installments are due and paid. Under certain circumstances, the lender must accept partial payments.

The courts disagree about whether the lender's failure to comply with these requirements provides the borrower with legal or equitable defenses to the foreclosure action; most courts have held that it does.

Again I'm not a lawyer and this is all based on research I have done. You should speak with one yourself about this.

[balzsand]

Thanks for getting back to me so quickly. Since this is an FHA loan, do you know if it's possible to file a partial claim or to get some sort of loan modification? Should I contact Option One? Since the mortgage company itself won't talk to us since it's in foreclosure I'm not sure if I have any options. We are even in the position to pay double monthly mortgage payments if we were permitted. Thanks again for your help.

[Moe]

You're most welcome.

Are you in a position to come to the table with some "good faith" money. If you owe $20,000, have you offered $10,000 or $7,000 and then get on a reasonable payment plan. You might just get a forebearnce plan, which can be risky for you. One late payment and they could foreclose.

[balzsand]

I could do $5,000 and I know we could continue normal monthly payments from that point on. Have you ever had any dealings w/ M&T? What do you recommend?

[balzsand]

One other thing, I haven't offered because I haven't been able to reach an actual person. I get a recording to contact the attorney. The only thing the attorney does is give us the reinstatement figures.

[Moe]

I haven't or have I heard much about them. Try caling a non-profit or 1-888-995-HOPE or www.995hope.org They have special contacts with banks, You need someone who can get through to them and present your case, like FAST!

[Moe]

So that's 25% of what you owe. Tough. They may want you to make regular plus additional monies monthly till you pay off the delinquent fees.

Just call someone an agressive non-profit or legal aid attoney in your area.

Originally Posted by balzsand

I could do $5,000 and I know we could continue normal monthly payments from that point on. Have you ever had any dealings w/ M&T? What do you recommend?

[evel1999]

Why can't she call the Hud credit councelors that has been referenced on here since it is a FHA loan? They usually council and help with forclosure.

[Moe]

Yes, 995 HOPE is one and they are one of the best from my research. FHA, VA, Fannie Mae all have strict loss mitigation standards that lenders need to follow.

[balzsand]

Have you ever heard of a gap loan to get out of foreclosure?

[Moe]

Sounds like a made up loan by some investors t? Never heard of it. Why do you ask?

[balzsand]

My house was recently sold at an auction, however, the sale has not been ratified. I've been reading a lot of information about contesting the foreclosure if the person filing suit filed a lost note affadavit. The original loan was Chesapeake Mortgage Company, then transferred to Bank of America, then M & T twice. M & T is the company that filed to motion for a lost affadavit. Should I contest the foreclosure because they may not be the holder of the original note?

[Cat Damiano]

Unfortunately............this question would need to be asked of an attorney.......