QUESTION
If a mortgage is fully paid and discharged by the bank, does the Note stay in tact as a fully due and payable debt?
Asked on Aug 14th, 2012 on Bankruptcy - Michigan
More details to this question:
If mortgage is "fully paid, satisfied and discharged" by bank. In 2008 Bank verbally agreed to a short sale but never provided release documentation, now collection agency is hounding me for difference plus interest, fees, claiming Note is still valid.
8 ANSWERS
Dennis P. Mikko
The note is the actual instrument that signifies the debt. The mortgage is the security instrument securing the debt to your home. If you satisfied the debt in 2008, the note should have been cancelled. You should contact the bank to determine why that did not happen.
Answered on Aug 19th, 2012 at 5:16 AM
Construction Attorney serving Bloomfield Hills, MI
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Law Offices of Jeffrey Z. Dworin
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No. You should request the cancelled note from the bank and keep it in a safe place.
Answered on Aug 18th, 2012 at 2:08 PM
Real Estate Attorney serving Williamstown, NJ
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Law Offices of Slotnick & Schwartz
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The Note is the personal obligation. The mortgage is only a lien on the home. If you do not have proof that the Note has been fully satisfied you still owe it.
Answered on Aug 18th, 2012 at 2:05 PM
Litigation Attorney serving Pearl River, NY
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Law Office of Bijal Jani
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Unfortunately, since whatever agreement you had with the lender was not put in writing it is very difficult to prove the short sale agreement. However, if you have other written communications such as emails and letters, you may seek to bring a claim against the lender and collections agency as a meritless claim.
Answered on Aug 18th, 2012 at 1:36 PM
Family Attorney serving Henderson, NV
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Harris, Yug & Ohlinger
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Everything involving real estate is governed by the Statute of Frauds. Therefore all agreements must be in writing. If the bank never agreed to the release, how else was title transferred.
Answered on Aug 18th, 2012 at 7:36 AM
Litigation Attorney serving Westland, MI
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Clos, Russell & Wirth, P.C.
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If the bank did not forgive the deficiency between the short sale purchase and the amount owed on the note (and you would have received a 1099 at the end of the year showing the forgiven debt as income for tax purposes if it did) then the debt remains owing.
Answered on Aug 18th, 2012 at 6:51 AM
Bankruptcy Attorney serving Phoenix, AZ
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Law Office of D. L. Drain, P.A.
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You need to go the title company that handled the short sale.
Answered on Aug 18th, 2012 at 6:41 AM
Appellate Attorney serving Grosse Pointe Farms, MI
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Musilli Brennan Associates, PLLC
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Engage an attorney, from what you have related it would appear you should not be liable, but the devil is in the details.
Answered on Aug 18th, 2012 at 6:24 AM