You Cannot Modifiy a Mortgage Note
Date: Sat, 11/28/2009 - 06:23
I have to warn the public against any so called "loan modification" that does not involve a brand new closing Canceling the Note, Issuing a New One, and filing a Modification of Mortgage.
Let me explain. A Note is a negotiable instrument just like a check. If I write out a check to person A for $5000 and I tell person A that I cannot pay the $5000 today but I can pay $2500 this month and $2500 next month, how do we modify the Check?
We VOID it out and issue a new one. The same rules apply with Notes. The Note has to be canceled. The only problem is that in order to cancel the Note, the bank or trust must have possession of it. . . this is the problem with all the notes being securitized. . my advice is hire an attorney that carries malpractice insurance.
Let me explain. A Note is a negotiable instrument just like a check. If I write out a check to person A for $5000 and I tell person A that I cannot pay the $5000 today but I can pay $2500 this month and $2500 next month, how do we modify the Check?
We VOID it out and issue a new one. The same rules apply with Notes. The Note has to be canceled. The only problem is that in order to cancel the Note, the bank or trust must have possession of it. . . this is the problem with all the notes being securitized. . my advice is hire an attorney that carries malpractice insurance.
If I have understood you correctly then a mortgage can't be modi
If I have understood you correctly then a mortgage can't be modified but one needs to cancel the existing loan before taking out a new one with changed terms, right?