Legal? Yes or No

[car67]

I have a family member who is facing foreclosure for failure to pay second mortgage.
Family member has retained an attorney who is full of crap in my view.

Why do I feel this way?

Attorney tells family member that since the second mortgage was sold from the original lender to the new investor for less then what was owed then by law the balance owed is what the investor paid for the note

Lets say the note is $100k to start for the second, bank sells to another bank for $60,000 to get it off its books as its a bad loan. Now this attorney is saying its law that now the debt is only $60k and the new bank cant charge any more beyond that.

My family member paid good money to this shark to stall a forecloseure sale set for May 18 and all the attorney said he is going to do is file a temp restrianing order to force the lender to show proof he has the correct chain of title and that he has to show what he paid for loan and therefore is only entitled to the amount paid for the paper.....

I think this is ashark attorney who is barking just to generate fees which family member should use to cure his lates rather then fight the system......... OPINIONS PLEASE

[despritfreya]

Yes, the attny is "full of crap".

The 1st part is a completely bogus argument. Promissory notes are negotiable and are sold at discounts all the time. The borrower is still responsible under the terms of the note.

The 2nd part is the "show me the note" delay tactic. It is also bogus but it can cause delay in the foreclosure.

My real question is why is the 2nd foreclosing? Is there equity in the property over and above that which is owed to the 1st?

I sure hope there is a TRO in place by the 18th. Your family member probably needs to be seriously thinking about a bk. However, if there is equity in the property over the amount owed to the 1st he/she will not be able to strip it. But he/she can "cure and maintain".

Des.

[AngelinaCat]

It probably is 'legal'. Is it moral? More than likely not--especially if the family member can ill-afford attorney fees, court costs, etc., associated with pursuing this action.

It sounds like the attorney is taking the conservative approach in making this lender prove his paper trail. There have been many news stories lately, especially in Florida, where the paper trail is NOT valid, and the debtors have prevailed.

Now, I have to ask: if this is the second mortgage, what happened with the first?

[AngelinaCat]

Well, Des got in ahead of me. If you aren't aware, Des IS an attorney, and has put into words things that were going around in my mind, but did not know how to express.

Thanks, Des.

[BigJohn]

I would say the original poster's relative appears to his lawyer as being black and white all over with big mammery glands - otherwise appears to him as a cach cow.

[despritfreya]

@ Cat

While I have not kept abreast of all of the hoopla over the "show me the note" litigation (Florida for example), the few cases I did keep track of ended in the loss of the property. In the context of the bk, the standing issue only delays the lifting of the stay. In the context of the actual foreclosure I have personally only seen one case where a lender was required to release without payment and the reason had nothing to do with the validity of the note but everything to do with a pissed off judge who hammered the creditor with a sanction.

I am sure there are a few examples where the argument was successful but my guess is that even in those you will find facts that are extremely unique.

To me, the "show me the note" argument is not a winner.

Des.

[car67]

thank for chiming in..... I knew I was right but just wanted the boards comments to show my family member! thanks!@

[AngelinaCat]

car67, I hate to tell you this, but if your Family Member is intent on taking this course and *teach the *bastardo* a lesson, you have as much as a snowball's chance in Hell to change his/her mind.

It will cost the person greatly in both his/her financial affairs, but will also cost in family relations. Trust me. AngelinaCatHub, my dear 'Hub, and I both squandered a small fortune trying to file against and teach the *facts of life8* to our cyberstalker.

We knew this person and what he was doing, but the laws are such that we could do nothing against him, although we tried multiple times. It cost us three well paying jobs, and a BK.

In spite of saying all this, I suspect your family member will not pay any attention. Good luck to you.

[AngelinaCat]

I should add that when the one GOOD attorney that we had, that we somewhat trusted, suggested that we were being strung on by the other two, we failed to listen. We were certain that we were on the RIGHT, and that morally we should and would persevere.

Well, there ain't no results when the money runs out, and the other attorneys dropped us like *hot scalding rocks*. They were doing this pro-bono, as long as we paid the court costs. Our money ran out, even though they won a judgment of $11,000, and they will NOT go after it.

We have tried and tried to get these people to go after that ruling--all they have to do is submit an itemized spreadsheet of costs. They wouldn't do it, and will not even talk to us now, as those guys had grandiose ideas of making 'Case Law', and feathering their nests.