Bankruptcy / Mortgage Question:
I am current on my mortgage
I want to declare bankruptcy and eliminate my entire mortgage debt - all of it
I have a MERS mortgage
and only Linda Green knows "owns" the note
If I declare bankruptcy, Will the bankruptcy court require the lender to produce the original signed note
will a "he owes us money" and / or photocopy of the note satisfy the evidence of debt for the bankruptcy court
2 Answers from Attorneys
It has been my experience the bankruptcy court and state courts in California have not been very receptive to a "show me the note" argument. Bankruptcy courts are particularly reluctant to accept this argument because it is a federal court and the validity of the mortgage would really be determined by state law.
The other thing to consider is that voiding the mortgage might be something that benefits your creditors rather than you. The trustee might very well seek to sell you home if the mortgage were invalid.
I agree with Mr. Starrett about the "show me the note" strategy. In the past, there was a rule that only the original of a writing was evidence of it. This rule was known as the "best evidence rule." We no longer have it. The Court will likely look to see if you have a debt that is secured by your property. If so, and it is fully secured, it would be nondischargeable, in bankruptcy. If you are having trouble paying arrearages, but you have a regular income, a Chapter 13 might be a viable option for you. With that, your secured debt will remain, but the arrearages could be paid over a period of 3 to 5 years.
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