Notice of Default coming...

[jlmaca]

My Notice of Default is coming soon. The mortgage company already has a relief from stay. My Chap7 will be discharge in couple weeks. I did not reafirm the house in Chap7. Since they still have to foreclose to get the house back I'd like to stay here a bit longer. I'd like to actually answer the Notice of Default to prolong things instead of letting them get a quick default judgement. Can anyone steer me to a source for example legal answers that I may use?

[justbroke]

Well, you would answer a Lis Pendens of Summons for Foreclosure, not the Notice of Deficiency. I'm not really one to advocate stall tactics when you surrendered the home in the Bankruptcy. Yes, it's nice when the lender talks their sweet time and you enjoy the free time in the home... but you're talking about not even having received an Notice of Deficiency yet.

Depending on your State, you could have 180 days or more of "free rent" (which is what I suspect you want)... without even doing anything.

Is there some particular reason that you need to stay longer? In what State is the home located.

[jlmaca]

Well, you would answer a Lis Pendens of Summons for Foreclosure, not the Notice of Deficiency. I'm not really one to advocate stall tactics when you surrendered the home in the Bankruptcy. Yes, it's nice when the lender talks their sweet time and you enjoy the free time in the home... but you're talking about not even having received an Notice of Deficiency yet.

Depending on your State, you could have 180 days or more of "free rent" (which is what I suspect you want)... without even doing anything.

Is there some particular reason that you need to stay longer? In what State is the home located.

I live in Maine. If I understand you correctly the first thing they send me is the Notice of Default/Deficiency? Then if I don't cure within that time frame I receive a Summons for Foreclosure? Then I have 30 days to answer that?
Then after I receive a foreclosure judgement by Maine law I have 90 days until a sale date is set? Am I right here?

[justbroke]

Maine's foreclosure laws are much different than down here in Florida. I can't provide you with information that would be flawless. Maine seems to use strict foreclosures which are much different than our foreclosures here. After the lender sues for foreclosure and wins, you then have 3 months to redeem the property. If you don't redeem it, the lender can then sell the property.

So basically, you receive an NOD or some other deficiency notice. They generally give you 30 days to cure. If you don't cure it, they will "accelerate" your mortgage and file a suit for foreclosure. You have so many days to respond (usually 30). Then they ask for a summary judgment and are awarded their judgment of foreclosure. They then need to wait for the redemption period of 3 months. This allows junior lienholders to redeem the Note as well (since they may stand to lose).

So I think you're right. I think you have at least 30 (Cure Period), 30 (Answer Summons), 90 (redemption period), for a total of 150 days. That's if they are aggressive.

[jlmaca]

Seems strange to me that they would'nt be more aggressive trying to work it out with me to just sign a deed in lieu of foreclosure and negotiate a time to vacate. It's gotta be costing them a bundle to proceed with a foreclosure. Can they bill me for this legal expense?

[justbroke]

No. Since you surrendered the property in Bankruptcy, you won't owe anything related to their foreclosure costs... or any cost related to that property.

[JustFileSuit]

It is much more involved than that.

In order for a Contract to be defaulted, the Obligor (that's you) has to be advised that the lender considers you to be "in default". So there is a "Notice of Default" that should set forth, in detail, what it is the Lender considers to be in Default, and, within that same document, what it is you have to do to "cure" the default.

It is typically money, but not always. For example, suppose you are operating a business out of the home (like a welding shop) in violation of the zoning ordinances and your Mortgage Document only provides for using the property as a family residence. Or suppose you have sold the home but have not obtained the consent of the Note-Holder.

Once you have the Notice of Default, if you then Cure the Default, the Note is undisturbed. BUT: that is a theoretical discussion, as you have not paid, and do not plan to pay.

the next step for the lender is to file a Suit, which they do by writ of Summons and Complaint. the "servicer" (probably a state sheriff or court marshal) will deliver it to you, either "in hand" or at your "abode," by putting it under your door. He will file a "return of Service" stating that you have been servied, and that puts you (and them) before the Court.

You now have to file an "Appearance," which is a simple one-=page form that gives the clerk of the court your name and address and where they can send you the Court mail. If you do not Appear, then you will be defaulted for failure to appear. Judgment will then follow.

After you Appear, you have a short delay, typically in New England of 30 days, to file an Answer. You can file a number of other Pleadings, including a Motion to Dismiss (on certain technical grounds), or a "Request to Revise," asking that certain statements be set forth with greater precision, or a Motion to Strike, which is quite technical, and then ultimately an Answer and/or Special Defenses.

The Motion to Dismiss would relate to certain grounds relating to failures or defects in the Summons and (more commonly) the service, challenging the Court's jurisdiction over the person. If they screw up the Service or the return to Service then that is fertile grounds for a challenge, and the process starts over. they probably won't, but I have seen it happen.

In a "Request to Revise," you could ask for a re-statement of the claim to set forth with specificity what the "default" actually is, so that you can intelligently respond. Typically, these foreclosure attorneys are never faced with opposition (some 99% of foreclosure suits are not even responded to), so they just use boiler-plate. If the suit states: "the defendant is in default of the Note..." the the obvious question arises: "How in default?" So then" the defendant request the plaintiff set forth with specificity how the defendant is in default on the Note and Mortgage, so that the Count of the Complaint can be intelligently responded to." they can either re-write the Complaint (adding a few weeks to the timeline) or go to Court Argument, adding a month to the timeline.

Ultimately, you get to the Answer. IF, and this is the big IF, the Note has passed down from hand to hand and you are dealing with the fifth "lender" and the lender is now a CDO and has a Trustee for the Real estate trust and the matter is being handled by the Servicer, then you can Deny the Complaint (by simply stating "Denied" to each Court) and raise as a Special Defense that the Plaintiff in the suit is not the proper party in interest, and is not the Holder of the Note. They probably are not!!! Most suits that are started by lenders where the Note is being held by a real Estate Asset trust through a CDO have no clue where the Note is or if they are the actual Holder. usually it turns out that the Note is either lost, or that someone else is sitting on it.

Now the genie is out of the bottle and you can end up sitting in the house for the next fifteen years, while they try to sort out who the Holder of the Note is. So it is not like a suit in foreclosure is a foregone conclusion.

[justbroke]

And, to add to what SoSueMe... err... JustFileSuit wrote... if you really want to do this and play it out, you probably want a forensic examination of your Mortgage and Note... especially if it's an old mortgage. Then determine whether you want to hire an attorney to defend the note.

While JustFileSuit talks about dragging it out, you would need to be very good at procedure in the local courts or you'll get tripped up.

I still don't know why you (jlmaca) are trying to delay this. So what's the reason?

[jlmaca]

And, to add to what SoSueMe... err... JustFileSuit wrote... if you really want to do this and play it out, you probably want a forensic examination of your Mortgage and Note... especially if it's an old mortgage. Then determine whether you want to hire an attorney to defend the note.

While JustFileSuit talks about dragging it out, you would need to be very good at procedure in the local courts or you'll get tripped up.

I still don't know why you (jlmaca) are trying to delay this. So what's the reason?

I specifically want to delay to save money for when we find a place to rent. I've been here for 23 years and have a lot of junk to move. I have a construction business here that must be relocated so anymore time and money I can save will be a real help. I was thinking of moving in April or May of 2010 and just dont want to be thrown out in the cold or caught off guard. It seems however, from all the great advice I have been given that between my time table and the foreclosure process I should be ok. I'd really rather not get involved in delay tactics if I can help it. I also don't want to be hurried out of here before I'm ready.

[justbroke]

Let's see. You should have already been saving money to move. If 6 months worth of saved mortgage and property taxes isn't enough or won't be enough... there's something wrong. I think you'll survive through April or May 2010. As I posted earlier, I *think* you're looking at 4-6 months from the time of the Summons for Foreclosure. If you answer the summons, you could be there a couple of more months. Since you don't even have an NOD yet, we don't even know when they'll send you one (could be anyday, could be weeks)

Also, since you say you've been there for 27 years, you might actually be one of those people who have trouble with their Mortgage/Note! If you've had the same mortgage for 27 years, then you may be able to challenge it on a legal basis. I don't consider that a stall tactic... I consider that a true legal issue as to who owns and holds the Note.

[jlmaca]

Let's see. You should have already been saving money to move. If 6 months worth of saved mortgage and property taxes isn't enough or won't be enough... there's something wrong. I think you'll survive through April or May 2010. As I posted earlier, I *think* you're looking at 4-6 months from the time of the Summons for Foreclosure. If you answer the summons, you could be there a couple of more months. Since you don't even have an NOD yet, we don't even know when they'll send you one (could be anyday, could be weeks)

Also, since you say you've been there for 27 years, you might actually be one of those people who have trouble with their Mortgage/Note! If you've had the same mortgage for 27 years, then you may be able to challenge it on a legal basis. I don't consider that a stall tactic... I consider that a true legal issue as to who owns and holds the Note.

Yes, I had been saving money and ended up using it for wife's medical emergency. Business is also in the crapper with the wonderful economy. So finally after Chap7 discharge I can now start putting that money away for a new start. I had refinanced everthing about 5 years ago with Option One. The note holder is Wells Fargo. I'll definately look over the note but might just hire a forensic audit done. Just not sure.

[JustFileSuit]

Also, since you say you've been there for 27 years, you might actually be one of those people who have trouble with their Mortgage/Note! If you've had the same mortgage for 27 years, then you may be able to challenge it on a legal basis. I don't consider that a stall tactic... I consider that a true legal issue as to who owns and holds the Note.

For the readers out there, I would suggest that probably 40% of all "foreclosures" are being started by entities that are not the proper Holder of the Note. if your Note has been sold more than three times since 2001, you are likely within this lovely group.

So if they are not the Holder, why would you allow them to toss you out of your home? makes no sense. there is somebody else out there that is the actual Holder, and that party also has claims against both you and the property. Better to find out now than later, after you have paid the wrong party for 15 years (although considering how totally screwed up the mortgage servicing is these days, they might well never figure it out!