Is it possible that you don’t actually owe the mortgage provider that’s foreclosing on your home anything at all? If you went through a whirlwind loan process during the height of the real estate boom with one bank only to find out that your loan was promptly sold to another, there’s a possibility that this unique foreclosure defense could apply to you. This is what you should know.

Lenders need to prove that they have the right to foreclose.

When you went through the initial mortgage process, you signed a mortgage and a promissory note. The promissory note is the document where you agree to pay back the loan on your house. The mortgage is the document that pledges your home as security for the promissory note if you fail to pay.

In order to foreclose on you, your current mortgage service provider needs to show that it has the legal standing to do so. Many of these banks and other financial entities that bought up loans by the bundle during the housing boom are coming up short when asked to provide proof of the original mortgage. A 2015 University of Iowa study indicates that the original paperwork and other required documentation occurs more than 40% of the time.

Sometimes the original paperwork was lost or destroyed in one of the transfers, or the legal procedures transferring ownership of the promissory note over to the new bank might not have been correctly followed. Other times, the assignment of the mortgage to the new lender was never properly recorded with the county recording agency.

This won’t necessarily stop your current mortgage service provider from trying to foreclose on you, however, and they’re often successful simply because people don’t realize that they can demand proof of the loan’s validity.

Courts are getting tougher on banks that can’t back up their claims.

Many people who bought their homes during the real estate boom saw their loans sold several times over—and banks often got sloppy about the paperwork. The courts are now responding without a lot of sympathy to the lenders.

In early 2016, for example, Florida’s 4th District Court of Appeals reversed a number of foreclosures because the banks couldn’t prove that they had possession of the original promissory notes.

Stay in your home and contact an attorney to help you.

An attorney who handles foreclosure defense services can help you issue the proper demand letter to your current mortgage service provider.

This can produce several different outcomes. It may halt the foreclosure entirely. It could also pressure the mortgage service provider to put more effort into finding a loss mitigation program that will allow you to refinance and keep your home. If you still ultimately end up in foreclosure, it can buy you months of valuable time to save your money while the process is delayed.

For more information or to discuss your specific case, contact us right away. We’re glad to assist you with your problem.

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