Short sale & Unsecured Promissory notes

Guest

Linda, just to throw one more piece of shrapnel into the grenade... I obviously didn't take the time to Google this - but didn't IndyMac go belly up in the last few years? If so, that means that your note has most likely been securitized. And if THAT is the case, it is also possibly true that whomever your note holder is has already received 100% of at least the face value of your note through various insurance policies that are put in place to cover RMBS trusts.

I haven't been able to pin this one down yet but from what I understand, "note insurance" is placed on RMBS trusts to cover losses. In essence, Linda, your note holder may have already been paid for the value of your note. I know it's not fair to throw an unsubstantiated theory like this into the mix but between the possibility of the existence of various insurance policies, potential CDS investments and/or market shorts that were potentially made, note holders in general may have already made upwards of 4-6x the value of outstanding notes. Whether this is true in your particular case, Linda would have to be found out through the discovery process during litigation.

You might want to consider asking them to produce your original note and prove that they have legal standing (per Article 3 of Uniform Commercial Code and whatever state equivalent may exist) to enter into an agreement with you, or foreclose for that matter, before you sign anything. If they balk at the suggestion or flat out refuse, you might want to consider speaking with an attorney.

gmakerley · Posted: Sat Oct 31, 2009 4:42 pm Post subject:

mike, you've been through the wars, so i don't really question your post. the one thing i can identify with and concur with - but even more strongly - is that speaking with an attorney ought to be more than a consideration. it's a must for the majority of us.

Guest

I absolutely agree, George. Knowing what I do NOW, there is simply no way that the average homeowner can possibly cover all of the legal and financial angles in one of these cases. They may be able to cover enough to save themselves, and in some cases that's enough - the pro se appellate litigant in Miami who was so convincing that he had the judge literally tearing up the note holder's Motion for Summary Judgment and throwing it over the bench is certainly evidence of that.

Unfortunately, the sheer volume of steps, angles, points and countermeasures that should and/or need to be taken to protect a borrower legally are so numerous that it takes someone with literally years of experience and a check list as long as both arms to properly cover even a significant portion of what can be covered.

I say "consider" only because a borrower, in this case Linda, may have already attempted to find legal counsel. That in and of itself can be a frustrating experience. I know that I interviewed literally over 150 law firms before finding one that either even remotely understood my case or didn't want a $30k retainer or didn't flat out call me a deadbeat for "trying to get out of paying my mortgage".

Fortunately, programs and firms are beginning to finally catch on to the game - as evidenced by today's McClatchy piece on Goldman Sachs and their investments AGAINST the mortgage industry. Bottom line is that only the individual in the situation knows what they can financially, physically, emotionally and psychologically handle when thinking about litigation in this arena. Looking back over my last 8 years would I attempt to do this without an attorney? Not if I had the choice, no. Would I have attempted to do it without the RIGHT attorney if I had no other choice? Quite possibly. Sometimes having counsel who is unwilling and/or unable to listen to their client can be just as damaging as not having counsel to begin with, sometimes more so...

Guest

I have a unique situation...

I had an 80/20 loan in CA, total ~$310,000. The first was ~$250,000 and the second was ~$60,000. Both were used to buy the home to begin with.

After a nightmare year of the banks not communicating with each other, losing 5 buyers, and endless back and forth, we finally got both banks to approve a short sale at $169,000, but the second only would approve it after a promissory note for $6,000 IN ADDITION to the $3,000 they were getting from the closing. The sale and closing then went by with NO promissory note. Now, they (the second leinholder) are screaming about how they don't have a note and will come after our kneecaps if they don't get one. Now, don't get me wrong, I enjoy my kneecaps. But, do they have any recourse? Or does their complete ineptitude prevent them from doing anything but whining in hopes that I suddenly take pity on their poor bailed-out selves and send them $6,000 out of the goodness of my heart?

gmakerley · Posted: Sun Nov 15, 2009 8:46 pm Post subject:

i suspect that their pity party isn't going to be successful with you, but that you might be swayed by a legal manuever. do you have an attorney? i'd suggest consulting with one to see if there is any recourse now that no promissory note was signed. i'd have to agree that ineptitude identifies what took place, and my reason tells me they're out of luck, but that's not a legal opinion, of course. and when someone takes someone else to court (if they should try that), there's no telling what could happen next. if a fiesty judge like judge judy was on the case, both parties could lose!

smithsussane · Posted: Mon Nov 16, 2009 1:19 am Post subject:

Hi JAFO!

Welcome to forums!

The second lien holder can definitely come after you to recover his dues after the short sale. He has all the rights to recover his dues. If they cannot recover the dues, they can charge off the loan to a collection agency.

Feel free to ask if you've further queries.

Sussane

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