Missing Note Forestalls Foreclosure in Florida

Here is an interesting article sent to me by Liam Gillen from Orlando. It is from the Orlando Sentinel and is written by Mitch Stacy from Associated Press with a copyright to the Orlando Sentinel.

This is again a reminder of an issue that has been discussed a lot – that many banks have lost the original note. It is interesting to see that the mere request by the owner of the property to see the note, has stopped foreclosure proceedings in their tracks. While, as one expert quoted in the article, this may only end up being a “delay tactic”, it is still notable to see that banks are not as well-equipped to foreclose as they may appear to be. I believe issues like the one told in the article will play out more effectively in judicial foreclosure states such as Florida, where a judge has a determination of how the foreclosure proceeds. It would be interesting to get comments from experts in non-judicial foreclosure states such as California.

Sliced, diced mortgages buy owners time
Mitch Stacy | The Associated Press , February 18, 2009

Kathy Lovelace lost her job and was about to lose her house, too. But then she made a seemingly simple request of the bank: Show me the original mortgage paperwork.

And just like that, the foreclosure proceedings came to a standstill.

Lovelace and other homeowners across the country are managing to stave off foreclosure by employing a strategy that goes to the heart of the whole nationwide mess.

During the real-estate frenzy of the past decade, mortgages were sold and resold, bundled into securities and peddled to investors. In many cases, the original note signed by the homeowner was lost, stored away in a distant warehouse or destroyed.

Read full article on Orlando Sentinel