Foreclosure Loophole

[Mickey13]

FL Resident. Have friends that are in default on their mortgage. They have been notified they are deliquent. They have not paid thier mortgage in at least 6 months. After doing some reading they are now hopeful that no one will be able to figure out who holds the deed on the home and they will eventually get the house "for free". How realistic is this? How common is this? If no one knew who owned the deed then how would anyone know they weren't paying and put forth the action to foreclose? I'm a little confused and don't want them not planning for the inevitable because they have all their hopes pinned on this going away. Thank you.

 

[FlyingRon]

I'm confused. The deed isn't a single physical piece of paper and generally this is recorded at the court house. Finding it shouldn't be a problem and even if nobody finds it they don't just "get" ownership without legal action.

What I think they are getting at is the "show me the paper" dodge where they challenge the foreclosure action based on the plaintiff (the bank) not being able to produce the mortgage contract. This indeed can greatly stall the foreclosure process but won't get rid of the lien or whatever security instrument was put into place when the money was borrowed. I.e., they won't be able to sell the house without paying the delinquent amounts which can be substantial.

 

[HappyWanderer]

Google:

foreclosure MERS problem

You will find a ton of information on what will happen. It seems all they can hope for is a little delay in the foreclosure. IF they have a good attorney knowledgeable in making the proper motions.

 

[nextwife]

And many banks foreclose on their own loans, that they originated. I've never, ever had a FC delayed due to missing original documents.

 

[Mickey13]

Thank you all for the excellent insight!

 

[silaproject]

silaproject

Google "Illegal Forclosures" and see what you come up with. pay more attention the information regarding possession of the PROMISSORY NOTE instead of the deed.

 

[bigarmin88]

FL Resident. Have friends that are in default on their mortgage. They have been notified they are deliquent. They have not paid thier mortgage in at least 6 months. After doing some reading they are now hopeful that no one will be able to figure out who holds the deed on the home and they will eventually get the house "for free". How realistic is this? How common is this? If no one knew who owned the deed then how would anyone know they weren't paying and put forth the action to foreclose? I'm a little confused and don't want them not planning for the inevitable because they have all their hopes pinned on this going away. Thank you.

Its called "PRODUCE THE NOTE",if the leader is not the origenal one that loan the money,then they must produce the note.I had the same issue aswell,I been forclosed on but the moragage company that forcloseding on me is not the same one that give me the loan.Back in 06 and 07,big moragage moragage compaines where buying loans from wall street and not getting the paperwork from the closing of the loan and the note.I been resurearching on this for 2 years now.

 

[HappyWanderer]

Have you already lost in court and are looking for an issue to appeal upon? If so, you need an attorney. Even then, you're just delaying things. A BK may be appropriate and will delay things just as far.

 

[Mickey13]

No, they haven't been to court yet. Cannot file BK as they have already filed twice in the past 20 years. Someone told them about this loophole and are hoping they can somehow avoid the foreclosure. I don't see that happening but wanted to see how realistic this strategy was. Appreciate all the input I have received.

 

[FlyingRon]

Bankruptcy will delay but NOT prevent foreclosure.