Is this a foreclosure letter?

[tikiman]

We have been waiting for our house to be foreclosed on. *We filed a Chapter 13 BK in 2009 only to have to convert it to a Chapter 7 months afterwards in 2010. *We rec'd. our BK discharge in August 2010. *Our mortgage was included in the BK. *We got a letter from a law firm in November 2010 that said our loan was in default & they would be commencing foreclosure proceedings. *That is the last we heard from either the lawyer of the mortgage company. *We've been living in the house since then, not paying any mortgage obviously, and just waiting, waiting, waiting. *The mortgage company has been paying the insurance & taxes. *I wish we could say we had a bundle of money saved int he bank but we don't. *The economy nearly ruined my husband's construction business and we have been living paycheck to paycheck the last few years, just making enough to pay the monthly bills.

We rec'd. a certified letter today from the same law firm as before. *I am confused about what the letter says. *I am writing below what the letter says, word for word, with identifying info changed. *The bank names have not been changed--just our names, address and the law firm name. *We can't get help from the law firm that did our BK two years ago--they absolutely stunk and would be of no help. *Can anyone here please advise us? *Is our house being foreclosed on? *Do we have to be out immediately? *We are very scared, confused and don't know what to do.


RE: *Loan 123456789
* * * Doe, John & Jane
* * * Noteholder: *U.S. Bank National Association successor-in-interest to Wachovia Bank NA as Trustee for JP ALT **
* * * 2005-S1 H (hereinafter referred to as "U.S. Bank")
* * * Property Address: *1234 Main Street, *Anytown, Virginia 12345
* * * Our File # 12345.6789

Dear Mr. & Mrs. Doe,

U.S. Bank has requested that this firm forward to you, on its behalf and in accordance with #55-59.1 of the Code of Virginia, 1950, as amended, notice that the original note evidencing your indebtedness to U.S. Bank is unavailable. *Notice is further given that if you believe you may be subject to a claim by another person or entity other than U.S. Bank to enforce the instrument of indebtedness, you may petition the Circuit Court of the City of Anytown, Virginia, for an order requiring the beneficiary to provide adequate protection against any such claim.

Upon the expiration of 14 days from the date of mailing of this notice, a request for sale may be made of the trustees, or substitute trustees. *The substitute trustees, as of the date of this notice, are expected to be Smith & Smith, P.L.C. and/or Jones Trustee Services, L.L.C. and their mailing address is XXXX XXXX XXXX. *U.S. Bank reserves the right to substitute additional trustees in its sole discretion. *

Please note, if you have been involved in Bankruptcy proceedings, this Notice is being sent to you pursuant to law. *SHould you have any questions concerning whether you have ongoing obligations incident to this loan, same should be directed to your attorney. *

NOTICE: *Please be advised that this communication is from a debt collector. *This is an attempt to collect a debt. *Any information obtained will be used for that purpose.
* *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *Very truly yours,
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *Smith & Smith, P.L.C.

cc: *U.S. Bank National Association successor-in-interest to Wachovia Bank NA as Trustee for JP ALT 2005-S1.
* * * * **

[justbroke]

It appears you have a Deed of Trust and that the bank is asking the Trustee to proceed with a sale. Since you have already received the "acceleration" letter, demanding payment, then this is the bank simply telling the Trustee to proceed with the sale. The sale, however, must be done under Virginia law. That usually includes a notice of intent to sell with a date that is typically 30 days in the future. After that 30 days expires, the Trustee can sell the property.

I don't understand your confusion with this since you haven't paid since November 2010. It may be confusing because the process for a Deed of Trust is different than a "mortgage". The Deed of Trust is done through the Power of Sale clause in that deed and is done in what they call a "non-judicial" foreclosure. This means, it doesn't involve the court or litigation.

It's interesting that they lost the Promissory Note and can't find it. While you may be able to claim that they don't have the Note, Virginia law may allow them to still sell if they put a bond on the Note. They won't "insure" (bond) the Note unless you complain, within the 14 days, to a court that you challenge that the are the holder and owner of the Note. That could stall them, but all they need to do is insure the Note and the foreclosure proceeds.

Now, this note is a recommendation for the Trustee to sell. If and when the Trustee does this is anyone's question. i would say that the sale could happen in about 50 days from this notice to the Trustee. But since they are giving you 14 days to question the lost Note, that's another 14 days, so I'd say 64 days at the minimum.

That may still be a lot to understand, but know that Trustee Sales based on a Power of Sale clause done non-judicially are rather fast (less than 60 days). Your bankruptcy attorney is not a real estate attorney and they generally won't get involved in this type of business. Additionally, these Power of Sale deeds are really hard to defend since this is non-judicial. The only thing you could do is challenge the ownership of the "lost" Note in court and get a temporary restraining order (TRO). But, again, they'll probably just insure the note and proceed.

You don't need to be out "immediately", but you should certainly start packing your bags. You should receive notice of the sale 30 days before the actual sale. They must also advertise the sale for so many days. The not so funny thing is that they sometimes delay the sale but you may have already moved out.