Several weeks ago, before the mortgage foreclosure mess went mainstream, we alerted our readers to serious problems in the electronic mortgage transfer systems. Because of these electronic systems it is difficult, if not impossible, for banks and mortgage service companies to determine the rightful owner of the note and which company is legally allowed to service the mortgage payments.
Since then, we’ve seen GMAC, Bank of America, and a host of other banks cease foreclosures across the country under pressure from various Attorneys General.
The question on the minds of Americans who are in foreclosure, delinquent on payments, or are making payments but not sure if they are paying the right company is: Do I have to keep paying, and if I don’t will they take my house?
The first thing you’ll need to determine, with the assistance of your mortgage lender and mortgage servicing company is whether or not they have an original copy of the mortgage note, as well as the proper documentation (servicing agreement) from the service company.
A new web page at the SEIU web site (Where’s the note?) claims to assist homeowners with this process by simply filling out an online form, printing the letter and mailing it off to your bank.
It sounds simple, but we want to ensure that our readers take the proper steps during the initial validation process so that you are fully armed in the event a mortgage note and service agreement cannot be produced. The SEIU’s Where’s the Note web site falls short according to The Foreclosure Detonator:
There are two problems I find with this web site – www.wheresthenote.com. The letter is addressed to “the bank†not the servicing company that actually is managing your account. However, in many cases, your servicing company is owned by the bank addressed to. You need to refer to your payment stubs or your payment book of coupons to see who you actually make your check payable to or if already in foreclsoure, who the named Plaintiff is.
The second problem I see here is in the body of the letter that you can and should modify.
…
You are asking “the bank†– not necessarily your servicing company – to give you the name and address of the “true†owner of your note. If your “bank†is not the “true†owner then it will not have, should not have and cannot produce the original note. Second, if you are writing to your servicing company (that often have the name of the bank as part of their name) they never own your note and therefore should not have the original note in their possession.
Having possession of the note DOES NOT, I repeat, DOES NOT give them the right to collect your payments nor take any foreclosure action against you. You will have little defense if you stop making your payments to them or take any legal action against them for not providing a copy of the original.
Thus, while the SEIU’s web site attempts to assist homeowners, it looks as if there may be a gaping hole in their approach. We urge our readers to take the appropriate steps, as recommended by the Foreclosure Detonator, when engaging in the process of mortgage note validation.
Here’s What You Can Do:
FD has made the appropriate modifications to the original SEIU system generated letter to reflect the following. This letter should be sent to your mortgage servicing company. Since these are the people to whom you are writing a check every month, they bare the burden to prove that they are entitled to those payments.
The following is a mortgage note and mortgage servicing agreement sample letter. You may need to make modifications to suit your specific needs.
To whom it may concern:
I own the property at the address listed above, and your bank services my mortgage.
Over the last several weeks there have been many stories documenting the problem that banks are foreclosing on homes without proof that they own the loan. I have learned that in many cases, banks like yours do not even know who owns the loans you service. Employees at several leading banks have admitted to rubber stamping tens of thousands of foreclosures every month, without even checking to make sure that the bank had a legal right to proceed with foreclosure. In some cases, banks allegedly falsified mortgage documents to cover up their mistakes. There have been reports of two banks trying to foreclose on the same home, banks foreclosing on homeowners who were current on their payments, and even of a bank foreclosing on a home where the homeowner had never taken out a mortgage to begin with. This is not merely a “technical problemâ€â€“it is the difference between having a warm bed at night and being out on the street.
As a homeowner and a customer of your bank, I am horrified. I had always believed that it I played by the rules, I would be protected, but now I know that banks like yours think the rules don’t apply to them.
To protect myself and my family, I need to know who owns my mortgage. Within thirty days, I would like to know the name, address, and phone number of the bank or investor that owns my mortgage. Furthermore, in light of the recent allegations of foreclosure fraud, I demand to see the original mortgage note proving ownership over my home loan. I would like to see copies of all endorsements and assignments of my mortgage note and where and when the assingment(s) _if any – were recorded. I also ask that you provide me with evidence of your firm being contractually retained to service my loan.
If you fail to provide the information I am legally entitled to, I will be forced to consider all options available to me to ensure that my family and my home are protected.
I ask that I receive my response in writing.
Thank you for your attention to this matter.
Sending the above letter to your mortgage service company is the first step in the process. They are legally obligated to respond to your request.
*Important Note*: Send this letter utilizing the Certified Mail Return Receipt service through the U.S. Post Office. It will cost you approximately $5 for postage and added services, but it will ensure a paper record of your request and the bank cannot deny that they received it. Within a few days of their receipt of your letter, you will receive a green form with the date it was delivered and a signature from the person who signed for it at the bank. Keep this for your records. Failure to send with CMRR service could lead to complications if the bank denies that you sent the request.
What do I do after 30 days?
The thirty day window begins on the day the bank signs for the letter you sent via Certified Mail. Once this time period expires, you should have received a copy of all requested documentation.
If you have not received the documentation requested, or it is incomplete, or it does not prove assignment of your mortgage loan to the service company, or it does not include a copy of your title, you will need to take legal action against the bank.
This will require that you obtain an attorney. Most attorneys can be retained for less than the cost of your monthly mortgage, so this may be a cost-effective avenue to take for many of our readers. Essentially, if the mortgage service company/bank fails to deliver the requested documentation, this becomes a paper shuffle through the court system.
If all goes well, you may end up with a free house, or, at the very least, a deferment on your monthly mortgage payments (interest free) until everything is worked out with respect to paperwork. With the speed and efficiency of our current mortgage system, you may end up without having to make payments for months before everything is all said and done.
Give ‘Em Hell
We often discuss how regular Americans can take action against the banks that were complicit in the meltdown of our financial system. These very same banks are still acting with only their self interest in minds. They’ve been bailed out with billions of taxpayer dollars, yet refuse to take any meaningful steps to assist working Americans on the street. They would rather foreclose on your home than provide any assistance to modify a loan.
If you want to “take it to the banks” this is one way to start. Another way is to move your money to a local or regional bank not affiliated with the global financial cartels.
Large banks thrive on taking advantage of the small guy. They do this in various ways which include, but are not limited to:
Today, you have the ability to take the fight to the banks. If you own a home, don’t delay. Send a verification request to them now.
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Well done Mac.
marcy kaptur from toledo ohio started this anti-bank industry nonsense. don’t pay any attention to this creep -pay your mortgage like a true american or leave the country. it is anti-american not to pay your mortgage or not paying your auto loans. if you signed a contract you must abide by the rules of the contract. it’s the american way..Â
need jobs
banks took bailout money.they should use it to help the tax payers who the money came from
mushroom, you are not a true american just because you pay your bills. It takes more then that. If we the people are getting screwed by big banks, and you want to label people that don’t want to take it anymore, you can’t call them unAmerican anymore than we can call the people like you a spineless wimp! You make your choice, and don’t judge those who choose a different way.
mushroom, I agree with you. Â But in the contracts are penalties if you don’t pay your mortgage. Â Damaged credit rating, possible liability for the difference of an outstanding balance – what the bank sells the property at, court fees and penalties, etc… Â For some, the calculations here dictate breaking the contract, even with the unfavorable outcomes, are more favorable than keeping the contract.
Unethical? Yes. Â Practical? Yes.
Not on to playing legalize to retain a property and not pay your mortgage, which is what this article is about. Â Unethical? Â Yes. Â But let’s move on.
Are the banks acting ethically? No. Do the banks play paper work and court games routinely when it is in their interest? Yes.
So now we have a clash of the titans scenario.  Zero incentive for little people to act honorably because big banks/corporations/society institutions often act without  honor as well.  Why should one side be held to a high moral standard while the rich and powerful feel they are above that standard and break the rules routinely themselves?
Well, then it all comes down to personal morality. Â Who are you? What God do you serve? Jesus? Yourself? Depends on the day?
I’m underwater and I’ll try to hang with keeping up with my bills for as long as I can until I can’t anymore. Â I made some choices based on assumptions that didn’t happen, but I understand that I’m still obligated to fulfill my obligations regardless. But I do this to honor God, not because I feel any moral obligation to honor mega banks who want the serfs to play the game honorably why they themselves are corrupt.
What we are seeing is the break down of basic social contracts. Â If is very sad, and it is very dangerous. Â Elites dissed the American people, and the American people are about to start dissing elites. I have a feeling this will not end well, as both need each other for society to function. Â Both need to have mutual respect for each other. If this is lost, our society that is based on this mutual respect will best case scenario have to be reorganized or worst case scenario crash and irrupt into chaos.
Still lots of time for both sides to think this through, but not an infinite amount of time. Â The clock is ticking.
@ Mushy –
Wow – I actually agree with (as you’re not being OVERLY satirical this time) you that people should pay what they’ve signed on to pay – it IS the American way, however, so is actually HAVING a contract to abide by. No contract/title/paperwork, then you have no agreement – not even a handshake agreement. There was no bank representative present to shake with when I bought my house. myself, the sellers and our attorneys.
For those who say you should pay any mortgage agreement you sign, all mortgages are born in fraud and create no obligation in law. The bank “owns” your home simply because you signed a promissory note to them, not because they earned it. They have put up no consideration and are therefore entitled to nothing in exchange.
Everybody should immediately quit paying anything to those banks. If that was done, they would go under immediately and the fraud would be defeated.
yes stop paying now .dont wait it will take no time for them to wake up.banks are wrong for how they have treated the people.its time fOR the people to fight back.and that said .STOP PAYING NOW AND WE WILL ALL WIN.
Be careful, this knife cuts both ways.
While you may be able to muddy the waters as to who really owns your home, you’ll be shooting yourself in the foot when it comes time to sell your home.
If you keep paying off your mortgage, you’ll eventually have an asset to sell, but if you interfere with the system for a short term gain, you’ll have a tough time selling it or borrowing against it.
NO ONE BUYING .NO BANKS LENDING .NO JOBS NO MONEY.SO DO WHAT YOU HAVE TO NOW.YOU WE BE OKAY NO MATTER HOW IT COMES OUT.LIFE IS SHORT.DON,T WASTE IT .IF YOU HAVE TO MOVE ON .ITS OKAY TO RENT
“If you keep paying off your mortgage, you’ll eventually have an asset to sell,”
Maybe….maybe not.  Can you prove you paid it off TO THE ACTUAL HOLDER OF THE MORTGAGE ?
Because that is the NEXT shoe to fall in this deal. Â
What happens if your “servicer” doesn’t forward your payment to whoever actually holds the mortgage ?  The servicer goes bankrupt, or makes an error, or any one of several screwups…..What happens if, down the road, the ACTUAL note holder shows up with a claim ?
Any note I’ve ever signed for real estate, I got the original canceled note BACK when the obligation was paid, and a release of lien was sent to the county recorder canceling the deed of trust.  If they can’t come up with the original note NOW, they probably won’t be able to come up with it after payoff…..so it may still be out there, floating around in some securitized pile of BS, like a ticking time bomb.
Yeah…..this mortgage thing is like quicksand…..just keeps sucking deeper and deeper.
I LIKE THIS .YOU ARE SO WRIGHT
The end is fast approaching. This is exactly what needed to happen. The stock market and wall street continuing to accelerate while foreclosures and main street continue to drastically suffer. This abnormality is a key proponent in the collapse. Get read the Shit is about to hit the fan. Sooner than most think
Dave, I fail to understand how asking for proof of proper documentation will damage your credit rating and make it difficult to sell your home in the future. All you’re doing is asking for proof. The banks are required to comply. Now, if you receive notification back that they don’t know where the original note is, and you choose to stop making payments, then I guess you’d better be ready for any and all possibilities.
This mess is the “Black Swan” Â that will topple our’s, and the whole world’s, money system. Â Â Every pension fund out there is full of those RMBS and CMBS, worthless crap. Â Â If the mortgages are truly screwed up, then every pension fund is not only f*cked, but also broke. Â If the pension funds are broke, Â so are all the TBTF banks, Â that the Fed’s already given trillions too.
Mac has already posted articles,  about your 401k’s and IRA’s.  The collapse of the pension system will be the excuse for the government to take your money…..all in the name of  “protecting you”.
All. who still do not understand, why gold and silver is a must,  unfortunately,  will learn soon.   The FRN system is broken beyond repair……get whatever wealth,  you have left, out of this dying system  ASAP!………………just mho.
Tony,
Since last week the stocks all around the world are going up like crazy. I know that stocks don’t actually show what the real economy is like. But isn’t in an indicator?
Otherwise i could assume that they are manipulating the stock markets, throwing a bait, and wait for the small fish to bite it.
Then they will get the cash and vanish.
Take my country for example. You all know that Greece sucks, and a lot of U.S. money were given away to bailout a half-dead country. Today though, the stock market jumped a 2,53% upwards. And last week in total the gains reached a 4,5%.
What do you think is happening?
Manos
Many companies are buying back their stock while giving more layoffs & squeezing the bottom line. Fed money (think U.S. Fed “Reserve”) has the ramp door open with double D’s flying out the back end with the election around the corner.  Not all TARP money was spent anyway! Look out for TARP II. There are no green shoots. I believe in unicorns spitting rainbow skittles out the rear end. As Jim Sinclair says, “This is it!”
People that get out of the Ponzi game first always win.
Here’s what you can do. Sell your house in 2005 and invest the proceeds in gold, sit back and enjoy the ride while you rent nice houses at ever decreasing rents.
Didn’t take that advice before the bubble burst? O well, try plan B
Walk from your underwater home, sell everything you own, and invest the proceeds in silver.
Don’t like plan B?
Plan C, default plan.
Slowly lose everything you own of value to the pawn shops and starve to death in a cul-de-sac wilderness devoid of electricity and fresh water
Comments….. “Maybe….maybe not.  Can you prove you paid it off TO THE ACTUAL HOLDER OF THE MORTGAGE ?”
If you received a “Deed of Reconveyance” shortly after you paid the house off you can prove it that you did pay it off. It is also recorded at your county clerks office as well.
Here’s a parody on the HAMP remodification program. Warning strong languge but worth the listen.
http://www.youtube.com/watch?v=8pr7faI6yBY
What’s wrong w/ this commentary? Â It seems we have two Americas, the good kind which upholds honor, honesty, fairness, etc and the bad kind, deceit, treacherous, dishonest, etc. Â There’s more to this mortgage mess than just the personal gain of someone not wanting to “live up” to their obligations. Â If this gets out of control, we go to ANARCHY! Â In anarchy, there’s no law and order, most people don’t think things through on these blog sites, so amateurish and childish in their thought patterns. Â Look at Mexico, I know I don’t want to live in that condition, do you? Â Work hard, pay your bills, live honorably, take good care of your family and close friends, and live within your means, the rest works out on its own. Â Those whiners about “hard times, etc”, chances are, they lived way beyond their means, acted irresponsibly by taking on more than they can afford for a home/lifestyle and are now “constantly” scheming for a free lunch, just like the bankers despised so much by everyone in the country. Â My opinion, both groups of parasites and leeches can go to HELL and ROT. Â If Anarchy comes, I hope they all get theirs when their house get looted and their family gets killed due to a lack of law and order of their own making, serves them right. Â The Patriot.
Comments…..Outhouse class lawyers who’s only paperwork supporting thier legal standing is the paper dropped down the hole.
Yes, do the paperwork chase. But to quit paying the mortgage? Don’t be a fool. You will lose. The term is “unjust enrichment.”
Every piece of property I have bought had a clause stating, “due and payable on demand.” The courts have ruled that there needs to be a good reason for foreclosure. Non-payment meets the criteria.
I just watched a local commercial piece of real estate go through this. The buyer was right about the problems, but failed to make payments during the 9+ months of legal wrangling. The buyer lost due to the “unjust enrichment” ruling. Property was returned to the seller.
Hard reality, the “American way” is something for nothing. It has been that way since we came into being and only got worse since 1929. Oh it was bad before and that is what led up to the crash of ’29. During the Depression, we created a plethora of social programs to support the non-productive. Create an entitlement and by definition, it must remain forever or else.
As long as the presses print money, you will have more and more money chasing investments. Well, not really. The technicals provide hard evidence that it isn’t investments, but rather speculation aka gambling. In every game of chance, there are winners and losers. The winner pays the taxes. The tax money? The loser paid it out of thier loses which they transfered to the winner.
Now the complicity of the banks in this mess? Everybody who used credit is complicit; lenders and borrowers. You couldn’t afford it, but you borrowed to get it. Now you whine? You gambled and lost, plain and simple. Did the gov’t aid and abet your gambling? Sure, it is all about the tax revenue stream. But the people demanded the gov’t to do so.
Local and regional banks aren’t any safer and in most cases are even worse. They lack the easy access to the Fed. The paperwork might be better, but the financial underpinning of the locals is far worse. Just how many mega-banks have outright failed compared to locals/regionals?
Â
The real problem is the myriad of pension plans who invested heavily in real estate. Most were underfunded to begin with. Any loss of asset value just compounds it. Who do you suppose will pick up the tab?
Â
We have one more little (little?) problem. Scant remaining assets going into the hands of the legal professionals and the increased court resources needed. These monies produce nothing. Any and all costs will be transfered to the people. Just more money down the rathole. Misery really likes company and those who pursue this nonsense are eager for thier fellow Americans to pick up the tab.
The wealthy aren’t the problem. It is the middle and lower class. They pay far less than the actual costs of the programs they clamoured for. The wealthy have subsidized these lower groups. You honestly don’t think that productivity moved overseas just because of free-trade? We priced  labor and regulatory compliance all out of logical reason. You did it, I did it, we all did it. There is no such thing as a free lunch. Now we pay.
I thank you for my self, my grown children and my grandchildren. Just come around with your whining and I will express my gratitude with a 36″ Louiseville Slugger. Shut up and pay up.
—————————-
That you are on this site is evidence that you see some of the problems and recognize the immediate need to change it. Can we do it? No. We are vastly outnumbered by a factor of at least 100-1. We know that the SHTF when the pile collapses. All we can do is avoid as much of the fallout as possible and prepare for the inevitable.
When the music quits, there will only be so many seats left. The question will be what economic framework will exist afterwards. If we return to gold backing for the dollar, many of the current problems will be relegated to history. Savings will become common and most purchases will be in cash. Most mortgages will be owner-financed with a hefty downpayment.
Mosr real estate will have little value due to substantially reduced numbers of potential buyers. The population bomb will implode taking out as many as 90% or more of the world’s population.
Couple of problems with this. Loss of creativity and the real potential for the population to drop below the critical mass to be highly productive. Mass production with its attendent economy of scale demands mass marketing. Ya need population. The most creative desperately need a population to create for. Most of these folks are dependant upon the masses for survival.
So where does this leave real estate? The best real estate is the real estate you own. That’s own, not mortgaged. Pay for it or not. Our justice system is based upon the Constitution and the concept of judicial precedence. The precedence is against “unjust enrichment.”
overtheedge,
the banks are the ones who get the unjust enrichment. They claim ownership over an asset without putting up anything as consideration.
Unfortunately, our justice system is no longer based on the Constitution because nobody uses constitutional money. The so-called money at issue is private, as are the laws that regulate its use.Â
A mortgage is a contract, invalid if lacking consideration by all parties to it. Fraud vitiates the most solemn of contracts. As the entire financial system and government is based upon a monetary fraud, you cannot have a lawful obligation to either under the cConstitution.Â
I suppose you believe that the people are obligated by the so called National Debt as well.   If someone “loans” the government interest bearing debt notes and calls it money, that doesn’t make it a debt to me. No rights or obligations transfer.Â
The US government is a private corporation and it’d debts are its own.  It collaborates with the private banks to fleece as much off of you as possible.Â
Unjust enrichment is not a problem for the people who have been defrauded by these criminals.   The criminals have enriched themselves beyond your wildest dreams, unjustly.
Along with the financial terrorist occupying the White house, the day can’t be too far off that the people will stop the fraudsters by claiming lawful possession of any property associated with the Federal Reserve scam.Â
The banks have no lawful claim to anything and as soon as everybody realizes that and quits paying the fraudsters they will collapse and die.Â
It is not a matter of getting something for nothing, it is a matter of permanently stopping the banks from getting everything for nothing from a government sanctioned counterfeiting operation.
Patriot, what you refer to as anarchy is properly called chaos. It is true that chaos is undesirable, but anarchy only signifies an absence of rulers, not chaos. Anarchy is highly desirable, since it is the natural condition of mankind and the one that offers the greatest liberty. Order can exist in anarchy. Refer to the writings of Murray Rothbard, Stephen Kinsella, Hans-Hermann Hoppe, Walter Block, Carl Watner, et. al. for more information about anarchy and why it is desirable.
Those of you who see only two camps, that of those who abide by their contracts and of those who wish to break them for personal gain, (or as Patriot said, “… the good kind which upholds honor, honesty, fairness, etc and the bad kind, deceit, treacherous, dishonest, etc …”) are missing a couple of key points that sketch and TnAndy pointed out. That is, if there is no valid paperwork (valid mortgage, mortgage note, servicing agreements) then you don’t have a valid contract. You have no assurance that all of the money you are paying is going to the rightful owner of the note. You may pay off your loan only to find that no one can return the canceled note to you because no one knows who owns it. The owner of the note may come to take your property sometime in the future. Even if you can prove you paid off the loan, there is no proof the note holder was paid if no one knows who owns it. You may have trouble selling the property down the road if you don’t have a clear title.
Everyone should verify that all their mortgage-related documents are in order to avoid future surprises.
noguv4me :
good points-
I checked with Wells Fargo on my mortgage situation, got a prompt reply. They can facilitate a balance pay-off, if that is my desire- and give me a record of pay-off. However, as to ‘title’ …. they said they did not know who has the title, but they do not have it. Said, I could check the trail of transfer with the county recorder (for what that is worth). It is hard to see this all in writing from them. Just incredible.
I think Wells Fargo would love to receive a pay off about right now. Cash flow with a smile. Title? What title? We don’t need no stinkin title. Say hello to my little friend.
I understand that there may be a hypothetical issue with paying off your loan and then not being able to prove that it’s yours, but that is a much smaller risk than not making any payments at all to anyone for your home.
Doing that latter will guarantee that you have ownership issues down the road.
Pay your mortgage and you will eventually own it, don’t pay your mortgage and you will eventually regret it.
Think long term, not short.
Is the lender obligated to send you the note for free? Mine wants to charge a fee and I don’t want to pay it.
Comments…..@ The Patriot, are youspecial or slow? You think that any person that is in hard times caused it on their own? What about the guy that had a job for 22 yrs, was laid off, and found out that the money he had in his 401k was useless. And then he recieves a foreclosure notice because he got behind, because “parasites” like him were on unemployment, and couldn’t find a job. I really wish everybody thought like you. The sad and simple truth that all you idiots seem to forget, if everybody had the “only about me” thought process, you would still be under the crown, and France would still be west of the Mississippi. If it weren’t for people who stepped up for the little guy, there wouldn’t have been a revolution to begin with. But then again, I bet that’s different right? Your entitled to your right to say and print what you want, when you bash the “parasites” yet the “parasites” are the people who give and gave the ultimate price for you to say that.
I just wish people like yourself, who obviously have no clue how the real world works, would go away. It is truly sad that A, you would wish somebody in hard times to be murdered, and B, you feel that everybody in hard times is self inflicted.
Has anyone seen this post?
Why It Is OK to Walk Away from a Mortgage
http://sedonadeb.wordpress.com/2010/07/24/why-it-is-ok-for-you-to-walk-away-from-a-mortgage/
its hard to believe that things have come to this that now people don’t pay on the mortgage and live in the home for a year with no payment and banks have done the loans on people that they knew would more than likely default its like the devil that does the deal that knows he will have to collect. Seems like the glass steagal act would be the best thing to riegn these banks back in <a href=http://geneperez.net>Santa Maria Homes For Sale</a>
Patriot, et al. You fail to understand what this post is about.
It’s about enforcing the contract. A mortgage has reciprocal obligations. It seems there are a number of banks violating their contractual obligations.Â
In the same way that foreclosure is the remedy the note holder has for violations on the part of the borrower, so too is summary ownership the remedy the borrower has against the holder of the note.
If a note is improperly transferred, it reverts to the borrower; because the borrower is the actual owner of the property. Not the bank, not the loan servicing agent; the mortgaged property is the property of the borrower, until (and unless) a legitimate claim against the collateral can be made.
If I were to show up at your door, and say, “I own your mortgage, you have to pay me from now on,” you would ask me to prove it.
That is all this process does; asks the bank to fulfill their legal obligation to prove ownership of the note.
If they can’t, then the note was voided (per the contract) and no more money is legally owed.
So, to repeat myself, the people who do this, are being the sort of “good guys” you say you want them to be. They are insisting on the fulfillment of contractual obligations; and they are making sure those who violated the contract (that is, attempted to cheat their clients, the state [in the form of fees not paid on transfer of title] and the public [in the form of bailouts based on frauds]) are held accountable for their actions.