During the easy lending period prior to the Great Recession in 2008, almost anyone with a pulse could obtain a loan. Many of the people who were provided with a loan either should never have been given a loan in the first place, or the borrower was speculating that property prices would continue to rise and thus would simply refinance again at a later date. All of this activity, combined with an utter lack of regulation of mortgage backed securities, contributed to the Great Recession. As a result, many borrowers are still feeling the effects of the collapse of the real estate market by being sued for the deficiency owed on the mortgages, or they are going through foreclosure proceedings. As a recent Sixth District appellate decision held, the assignee of a deed of trust does not need to have physical possession of the promissory note in order to proceed with foreclosure proceedings.
Basically, the courts are making it easier for lenders to foreclose on property, without requiring the lender to even show a copy of the promissory note. Turning to the court system will not help you in this instance. In certain situations, a borrower may also face a deficiency judgment representing the difference between the amount received through the foreclosure sale and the amount owed on the note. Before allowing your house to be sold at a foreclosure sale and before having a deficiency judgment entered against you, speak with a debt settlement attorney. If your issue is an inability to pay on both the 1st and 2nd mortgage, an experienced debt settlement attorney can work with you to determine whether the 2nd mortgage can be reduced, allowing you to stay in your home. There are other alternatives to foreclosure proceedings; a debt settlement attorney can help you find them.