Facing Foreclosure: The Homeowner's “Produce the Note” Defense

The "Produce the Note" defense is used by the homeowner to demand that the foreclosing party prove a legal right to the mortgage payments under the promissory note attached to the mortgage. This strategy to show ownership of the debt by producing the note can buy time for the homeowner. It works better in jurisdicitions requiring judicial rather than non-judicial foreclosure.

Type of Foreclosure Used in Homeowner's State

In a judicial foreclosure, a lawsuit is filed by the foreclosing party. The homeowner can easily present the "Produce the Note" defense as a response. If the homeowner does not challenge ownership of the debt in the legal action by way of a defense to the foreclosure, the court will not bring it up, and it is lost forever. In a non-judicial foreclosure state, the lender does not file a legal action. It is up to the homeowner to initiate a costly lawsuit, with all the fees associated with it, to prevent the foreclosure from continuing. This is a more demanding process for the homeowner in the fight to keep his/her house. 

Demanding the Foreclosing Party Produce the Note

This defense is a plausible argument for the homeowner because of the way the secondary mortgage market works. Mortgages are often passed around, so the loan can be sold multiple times during home ownership. The mortgage documents are kept by a custodian or sent along later. Promissory notes can be lost or misplaced. In most cases the lenders can fix whatever mistakes they have made and produce the note, but demanding the note can buy the homeowner some time.

Giving the Homeowner Extra Time

While all of this is true, it is not safe to assume that sending a letter asking for the note will stop any foreclosure. But, it will give the homeowner extra time in his/her home. You should talk to a lawyer who specializes in foreclosure to explore this defense along with other claims to stop a foreclosure.