BOA foreclosure? Not sure what to do - it's rental property

[bladerunner]

after a short sale of our home. we were hit with an 139k 1099 irs form. if you are insolvent, "the mortgage debt relief act" will cancel the balance. if you want to dump the rental property, then bk may be the only way to go.

[Sweetpea3829]

des, pandora, et al...

I'm curious about this "show me the note" tactic.

See....we do want to only STALL a foreclosure. For now anyways. If you've read my other posts, you'll recall that we're in the process of buying a home through USDA Rural Development. In the meantime, our IIB7 home sits in RI with a mortgage that hasn't been paid since last August.

Initially, we were hoping for a modification for that home (which, incidentally, is a rental property, as is the OPs). And, truthfully, we are still in modification proceedings with LBPS and if they come forward with a really great mod, we'll keep the home.

But....in the meantime, my husband took a job out of state, we've moved and are trying to purchase a single family. USDA is fully aware that our home in RI is in default. We've been told that if the home in RI forecloses (or even if a foreclosure sale date is set) before we close on our new home, than when the underwriter does the final verifications, we will be disqualified. In other words...we need to CLOSE before we FOREclose.

So...as it stands, we have a notice of acceleration set to expire on June 21st. We have a modification under review with the loan servicer. And we're about four weeks away from our closing. Maybe longer because USDA takes FORever.

So it sounds like a "show me the note" tactic might actually stall the foreclosure from proceeding long enough for us to a) close on our new home; b) finish the modification review; or c) both.

How do we go about employing this? Does an attorney need to be involved?

I should also add...last fall, Citi transferred servicing of our loan to LBPS. In the paperwork that LBPS sent, there was a document that basically outlined how much we owed, how much our escrow was, blah blah blah. It said, in fine print, that if we had any questions on the contents of that particular document, or wished to dispute the figures provided, we could do so in writing.

I did. I sent a formal written request to them asking them to clarify the amount owed on our escrow. They acknowledged receipt of that request and indicated they'd resolve the matter within 30 days. They never got back to me. It was only after I called them and inquired what the hold up was (at the time we were seeking the possibility of a DIL) that they resolved that particular issue. They did so by sending me a copy of the mortgage instrument.

I'm assuming that my request was essentially a "show me the note" though I hadn't intended it to be such...just saw a way to delay the foreclosure at that time and seized it. I'm assuming that the documentation they sent to me essentially satisfied the "show me the note" request.

Does any of this make sense?

Basically...lol, we just want to delay any additional foreclosure proceedings for another two months. After we close on our new home...we can go from there with the discharged home.

ETA: Forgot to mention...the state the property is in is RI and the mortgage instrument specifically mentions non-judicial proceedings.

[despritfreya]

Sweetpea,

I cannot be much help here since I have never "argued" this issue and our firm stays away from such issues like the plague. I am sure someone will chime in with helpful insight. Also, you can Google the phrase combined with a search for a RI attorney who advertises this type of defense.

Des.

[justbroke]

I thought that RI is a "Deed of Trust" state with non-judicial foreclosures. These are most difficult to stop without getting a temporary restraining order (TRO) against the Trustee's Sale. I'm not familiar with the process in Rhode Island.

[Sweetpea3829]

JB, RI does both judicial and non-judicial. I read over the mortgage paperwork they had sent me and found that ours is clearly written to allow for non-judicial...and I assume that is the manner in which they will foreclose.

It's been really difficult getting specifics on how this process will go. We just really want the whole nightmare to be over. When we bought that multifamily several years ago, we never anticipated that we'd end up in a boat quite like the one we're in.

Mostly...we just want a home. A single family home. With no tenants and no tenant issues. I need maybe 4 more weeks to closing. And then, from there...we can close the book on the BK and move on. But...if the IIB7 house forecloses before we close...we're sunk for at least three years.