Does a Lender Have to Own the Note in Order to Foreclose or Can They Just be the Holder of Note?

When homeowners borrow a mortgage loan to purchase a property, they sign both a mortgage (or deed of trust) and a promissory note. The promissory note (not the actual mortgage contract) is the document that contains the promise to repay the amount borrowed from the lender. The owner of that promissory note (Note) is the only party that technically has the legal right to collect the debt owed on the property if you don’t make payments.

If a homeowner has fallen behind in making payments to a lender, the lender does not necessarily have to own the Note to file suit against you. The holder of the note is also able to initiate a foreclosure proceeding. However, assignments or blank endorsements are required for a Holder of Note to have standing to foreclose. If the lender potentially pursuing a foreclosure against you only holds the Note, you may be able to defend your case if they cannot produce the proper assignment documentation or blank endorsement.

Assignments of Note track transfers of the servicing of the loan as well as ownership. If the Holder of Note cannot properly establish the assignment or endorsement, they may not have standing to pursue the foreclosure as they lack the ability to prove ownership interest in the property (remember, the owner is the party that is able to initiate a foreclosure, but if they have given ownership interest to another party, that party can also sue the homeowner now, as long as the documentation is proper). Even when the Holder of Note does not provide clear assignment or endorsement, they may still be able to sue for the debt on the owner’s behalf in the State of Florida, so it is important to have an attorney involved in matters concerning Holders of Note.

Potential foreclosures are one of the times that you need to seek professional counsel to help you navigate the precarious situation. Even the smallest risk of losing your home isn’t worth taking without having an attorney who regularly handles foreclosures assist you in fighting to save your home. If you are concerned about possible foreclosure proceedings, call now to speak to a qualified, experienced real estate attorney who will be able to evaluate your case and help you determine the best way to approach your particular case.

Stephen K. Hachey, a Florida foreclosure attorney, can help your wade through this process and determine a positive solution. Contact him at 813-549-0096.

The opinions in this post are solely those of the author. The author takes full responsibility for the content. Like all blog posts, this is offered for general information purposes and does not constitute legal advice.

If you are sued for a sum of money that you may owe a creditor and lose the case, the prevailing party will be granted a judgment. That party may then file a judgment lien, which is a lien that attaches to your real estate. When a creditor files a lien against your property, the lien attaches to the property title. If you sell the property, you must pay off the lien before you can receive any of the sale proceeds.

However, creditors can recover the debt you owe before you sell your home and any lien holder can force your home into foreclosure if you do not pay the debt. In foreclosures, lien payment procedures are considerably different than lien payment procedures in private sales. In a foreclosure, a lien’s priority is typically determined by its recording date (though some liens, such as property tax liens, have automatic superiority over essentially all prior liens). First mortgages are usually recorded first and therefore are in the first lien position. The first mortgage is generally then considered the superior or primary lien holder because it was the initial lien on the property.

When a superior lien holder forecloses, it does not have to pay off any “junior” liens. Junior liens are any claims filed after the superior lien holder’s claim. A second mortgage or subsequent judgment liens, for example, are considered junior to the primary mortgage. After the foreclosure, all junior liens are cleared from the home’s title. Although foreclosure clears junior liens, it doesn’t remove liability for those debts. After foreclosure, the former junior lien holders will often pursue other collection methods to recover the debt you owe. In some cases, the creditor may try to attach a new lien to property you own, like your car, and seize that property.

Additionally, any lien holders can initiate foreclosure themselves regardless of lien priority order. However, even though a junior lien holder can initiate a foreclosure, the foreclosure proceeds must still follow a particular distribution plan. “Senior” liens are paid before “junior” liens (those with lower priority), so the junior lien holder must use any money received from the foreclosure sale proceeds to pay off creditors who hold liens superior to its own before it can apply the money to the debt owed by the homeowner. Further, the junior lien holder who initiated the foreclosure must distribute any additional funds amongst the junior lien holders according to each lien’s priority order.

Stephen K. Hachey, a Florida foreclosure attorney, can help your wade through this process and determine a positive solution. Contact him at 813-549-0096.

The opinions in this post are solely those of the author. The author takes full responsibility for the content. Like all blog posts, this is offered for general information purposes and does not constitute legal advice.

If you are pursuing a Chapter 13 bankruptcy, you are able to either short sell or foreclose on your home to settle that portion of your debt. The purpose of a short sale is to relieve the borrower’s obligation to pay the difference between the sale price of the home and the mortgage amount when the property is worth less than what is owed. A foreclosure is a much longer process that involves several steps after a homeowner falls behind on mortgage payments. The lender begins the legal process of selling the home at auction in order to get payment for the loan. If the sale price is less than what is owed on the mortgage, a deficiency judgment results. Depending on the jurisdiction, outside of bankruptcy the borrower would be personally liable for the entire amount of the judgment.

In a Chapter 13 bankruptcy scenario, no matter how the home is surrendered (either short sale or foreclosure) any remaining deficiency will be paid out as unsecured debt through the Chapter 13 plan. Because the borrower is responsible to pay some of their unsecured debt through the plan, a short sale that slashes this debt before the bankruptcy is initiated is beneficial. If a borrower can negotiate a short sale prior to filing for Chapter 13 bankruptcy, the plan payment will be reduced because the unsecured debt was reduced through the sale prior to proceedings. Thus, completing a short sale before a Chapter 13 bankruptcy has the potential to lower plan payments.

However, if you are already entangled in bankruptcy proceedings, a short sale and foreclosure will likely result in the same outcome – a short sale only eliminates the legal hassle involved with a foreclosure. If you are thinking about or have already filed for bankruptcy, it is in your best interest to meet with an experienced attorney to discuss your case. An attorney familiar with bankruptcy and real estate proceedings will be able to advise you whether your situation is suited for a short sale or foreclosure and may also be able to help you avoid selling your home.

When you are facing bankruptcy you feel like you have everything to lose. However, an attorney can help you put the pieces back together and make sense of your specific case. Don’t walk through a bankruptcy blindly, make sure you have all the advantages an attorney can give you.

Stephen K. Hachey, a Florida real estate attorney, can help your wade through this process and determine a positive solution. Contact him at 813-549-0096.

The opinions in this post are solely those of the author. The author takes full responsibility for the content. Like all blog posts, this is offered for general information purposes and does not constitute legal advice.

When the housing market took a turn for the worst, the effects were felt far and wide across our nation. Many of us were directly affected or knew somebody that was. Foreclosure signs were popping up on every street and sadly, many people lost their homes. In the wake of such financial disaster, many laws were amended and changed including Florida’s Deficiency Law in 2013.

If you are familiar with real estate foreclosures and short sales, you may already know the general basis of the Deficiency Law. But for many, terms such as “underwater” meant little more than the location of Atlantis or where one ends up after jumping into a pool. So to ensure that we are all on the same page, let’s look at what Florida’s Deficiency Law meant before the amendment.

Under the old law, if a home was sold as a short sale or under foreclosure for less than the balance of the mortgage, mortgage lenders had five years to ask the courts for a deficiency judgment against the borrower. In other words, mortgage holders could seek to hold the borrower legally responsible for paying the difference between what the bank made from the sell of the home and how much the borrower still owed on the mortgage.

This concept of seeking a money judgment from the courts is still the bulk of the Deficiency Law. What has changed, however, is the amount of time mortgage lenders have to request a judgment against a borrower. Under the amended Deficiency Law, mortgage lenders now only have a year to seek a deficiency judgment on homes sold after July 1st, 2013.

Now, it would seem straightforward if the previous law governed homes sold prior to the July 2013 deadline while the new law pertained to homes sold after this date. But it isn’t that simple. In fact, the new law affects many homes that were sold prior to July 1st, 2013 if the five-year period did not expire prior to July 1st, 2014. So what does this mean?

Let’s say your house was foreclosed on March 28th, 2013. Since that date falls before July 1st, 2013, the old law applies to any deficiency that results from the sale and allows your mortgage broker to seek a judgment until March 28th, 2018. However, this date falls well after July 1st, 2014. With the amendment in place, the new deadline for your mortgage lender becomes July 1st, 2014.

On the other hand, if you sold your house at a short sale on March 28th, 2009, your mortgage lender would have until March 28th, 2014 to seek a deficiency judgment. Although this date is after the amendment date July 1st, 2013, the date falls prior to the July 1st, 2014 deadline so it is unaffected by the change.

In all cases, however, if a mortgage lender seeks a deficiency against you, it is important to consult with an attorney.

Stephen K. Hachey, a Florida real estate attorney, can help your wade through this process and determine a positive solution. Contact him at 813-549-0096.

The opinions in this post are solely those of the author. The author takes full responsibility for the content. Like all blog posts, this is offered for general information purposes and does not constitute legal advice.

When a debt owed on a house has not been paid, the lender or mortgage holder can initiate a foreclosure. A foreclosure is the legal mechanism used by creditors to repossess the property so that it can be sold and the debt owed on the home can be repaid. Creditors can foreclose a property anytime after the homeowner starts missing payments on the mortgage, unless otherwise stated otherwise in the mortgage terms, or in the laws of the state where the property is located.

If the deed to the property has more than one person listed on it, it is possible that a notice of foreclosure could be sent to only one of the listed deed holders. In the event that this occurs, the party that received the notice of foreclosure has 20 days after the date that the petition for foreclosure was served to service the other deed holder with the foreclosure documents. If this does not occur, the party not receiving notice of foreclosure can request a default motion. This will speed up the final hearing process to finish your case.

Foreclosure cases are all unique because there are many factors that impact the foreclosure process. If your HOA has filed a default motion in your foreclosure case, you need to immediately retain an attorney to help you navigate the foreclosure proceedings. An attorney will be able to assist you in understanding the nuances of your particular foreclosure case and equip you with the resources you need to try to save your home being repossessed.

No foreclosure case is exactly alike, so an attorney will be able to answer all of your individual questions about the foreclosure action against you. An attorney may also be able to take an immediate action to help slow the foreclosure process, including filing a motion for continuance. This is why you need to retain an attorney as soon as you receive the first foreclosure notice because waiting too long may prevent the appropriate motions from being filed.

Even though a creditor may technically own your house, it still feels like your own personal property. Make sure you retain an attorney to help you fight to save your home.

Stephen K. Hachey, a Florida real estate attorney, can help your wade through this process and determine a positive solution. Contact him at 813-549-0096.

The opinions in this post are solely those of the author. The author takes full responsibility for the content. Like all blog posts, this is offered for general information purposes and does not constitute legal advice.

Are you a month-to-month tenant renting a home that is in a pre-foreclosure and wondering what will happen next? Although these answers are generally more accurate when looking directly at your case, here are some of the basic facts that can hopefully paint you a clearer picture of the next steps.

First off, one of the most important things to know is the “Protecting Tenants in Foreclosure Act of 2009”. Before President Obama signed this act, most renters would lose their leases after a foreclosure; however, this legislation states that leases can stay intact.

There are two options available; the tenant can either stay until the end of their lease or month-to-month tenants are entitled to their lease for 90 more days before they are required to move out. This is a great benefit to tenants because this 90-day notice period is longer than any state’s non-foreclosure notice period, this gives the tenants time to find another place to live.

Here is some other important information that you should be aware of. If the buyer intends to live on the property, then they have the right to terminate the lease with a 90-day notice. In these cases, if state legislation is more generous to tenants, federal law will not overrule the state law.

In addition, those who live in a city with rent control “just cause” eviction protection are also protected. A change in ownership does not automatically justify a termination, and the fact that the change happened through a foreclosure does not make it any different. Tenants in these cases should look at their city’s ordinances list of allowable, or “just causes” for termination so they are aware of where they stand.

If you find yourself in this situation and you are unsure what do to, don’t be afraid to speak to an attorney. They have the knowledge and means to help you figure things out and they will help you better understand the whole process and each individual step.

Stephen K. Hachey, a Florida real estate attorney, can help your wade through this process and determine a positive solution. Contact him at 813-549-0096.

The opinions in this post are solely those of the author. The author takes full responsibility for the content. Like all blog posts, this is offered for general information purposes and does not constitute legal advice.

Foreclosures in Florida are judicial, which means that the lender must file a lawsuit in state court. In Florida, a foreclosure sale can’t occur before a foreclosure judgment is entered due to the fact that the lender must file a lawsuit.

To initiate the foreclosure process, the lender files a complaint to the court and the court then serves the borrower. Along with serving the complaint, the court also provides the borrower with a summons allowing them twenty days to file an answer. If the borrower does not respond within the twenty-day limit then the court can grant a default judgment to the lender, resulting in the borrower losing the case.

If the borrower does reply to the summons the lender has two options; they can either file a motion of summary judgment or go to trial. A motion of summary judgment is where the court grants judgment in favor of the lender if they see that there are no disputes to the important facts of the case.

Most lenders choose to file a motion of summary judgment because it’s quicker than going to trial. Likewise, most judgments go in favor of the lender because the court observes that the homeowner does not have much of a defense and therefore they wouldn’t have anything to present at trial.

However, the judge can deny the motion of summary judgment and the case can go to trial. If the borrower loses the trial than the court will enter a final judgment of foreclosure against you. Due to all of these phases, a foreclosure sale can’t occur before a foreclosure judgment is passed. Once the judgment is passed, then the foreclosure sale can proceed.

Stephen K. Hachey, a Florida foreclosre attorney, can help your wade through this process and determine a positive solution. Contact him at 813-549-0096.

The opinions in this post are solely those of the author. The author takes full responsibility for the content. Like all blog posts, this is offered for general information purposes and does not constitute legal advice.

This post was written by Stephen Hachey. Follow Stephen on Google, Facebook, Twitter & Linkedin.

It can be extremely unnerving when you’re renting a house that ends up in foreclosure. When that happens, you can be sure that the owner isn’t paying the mortgage. In many cases, it’s easy to assume that the homeowner isn’t paying any of the taxes, insurance or homeowners association fees either. You don’t have to worry about being thrown out onto the streets as soon as the foreclosure is completed. As long as you can prove you are a tenant, the bank or other institution taking over the property will need to ensure you are protected, at least for a limited time.

When you have a lease in place, you are entitled to finish out that lease term, even when the house is foreclosed upon. You’ll start paying rent to the bank or the lender that foreclosed instead of the homeowner. Make sure you continue with your rental payments, otherwise you will be in violation of your lease and you’ll be evicted.

When you do not have a lease in place, and you are simply renting month by month, you still have 90 days before the successor to the property can evict you. Continue to pay your rent and start looking for a new place to live, which you should have no problem finding within 90 days.

Something to keep in mind is that the foreclosure process can drag on for months and even years. If you have just heard that the house you are renting is in foreclosure, you probably have plenty of time to find another place to live. Continue abiding by your lease and make sure your own bills are paid for so you have an easy time renting again.

The opinions in this post are solely those of the author. The author takes full responsibility for the content. Like all blog posts, this is offered for general information purposes and does not constitute legal advice.

This post was written by Stephen Hachey. Follow Stephen on Google, Facebook, Twitter & Linkedin.

Every foreclosure is different, and so is every bankruptcy. What you may or may not owe your foreclosure attorney will depend on the terms of your bankruptcy. Start by checking the contract or agreement you had with your foreclosure attorney. Then, contact your bankruptcy attorney for help. In most circumstances, you will not be responsible for any debts that were discharged during bankruptcy. That will include your foreclosure attorney fees if they apply.

Another important factor is whether a reaffirmation was included in the bankruptcy. If it wasn’t, you shouldn’t expect to pay attorney fees after you declare bankruptcy. When your mortgage debt was discharged, the costs associated with that debt should go away. Take a look at the judgment that was finalized in court during your filing. You should be able to access a list of the debts that were discharged as well as any that were reaffirmed. Make sure everything is correct and then use that judgment to notify your foreclosure attorney that you are not responsible for the outstanding debt.

Again, all bankruptcies are different and the circumstances of yours will dictate whether you are required to pay the fees your foreclosure attorney may be demanding. Talk to your bankruptcy lawyer and if you are being illegally pursued for collection of that debt, get the help you need to fight back. If you aren’t able to get anywhere with your bankruptcy attorney, get additional legal help before you pay a bill that isn’t clear and you might not owe.

Stephen K. Hachey, a Florida foreclosure attorney, can help your wade through this process and determine a positive solution. Contact him at 813-549-0096.

The opinions in this post are solely those of the author. The author takes full responsibility for the content. Like all blog posts, this is offered for general information purposes and does not constitute legal advice.

This post was written by Stephen Hachey. Follow Stephen on Google, Facebook, Twitter & Linkedin.

On March 22, 2013 Administrative Order 3.312 became effective. This order states that any cases filed more than three years ago were being set for mass trials. The purpose of this is to help move cases along and reduce foreclosure backlogs. However, it can also flood the market with foreclosure sales.

A non-jury trial in a Florida foreclosure means that you are just facing the judge and they decide if they are going to grant the foreclosure. It is best to attend these trials if you plan to fight for your home and they are known to be short trials.

Since they are trying to clear a bunch of cases at once, judges are trying to withhold from extending or cancelling a trial. If you have a trial date approaching and need more time to prepare a defense, get a loan modification, close a short sale, or move from the property, you may want to consider filing for bankruptcy. If you file for bankruptcy before the foreclosure trial you may be more likely to have your trial cancelled thus allowing you more time to explore your options.

Foreclosures can be hard to deal with so make sure you understand what the process entails and what is being asked of you. Remember, a non-jury trial in a Florida foreclosure case means that you will just be in the presence of the judge and they will decide whether or not to grant the foreclosure.

Stephen K. Hachey, a Florida real estate attorney, can help your wade through this process and determine a positive solution. Contact him at 813-549-0096.

The opinions in this post are solely those of the author. The author takes full responsibility for the content. Like all blog posts, this is offered for general information purposes and does not constitute legal advice.

This post was written by Stephen Hachey. Follow Stephen on Google, Facebook, Twitter & Linkedin.