'Produce the note' has not had big local impact

It's almost one of those things that's too easy to be true - staving off home foreclosure by simply demanding that your lender produce the original note.

As the economy goes down foreclosures go up. Hard-working people are finding themselves being forced out of their home when they can't make their mortgage payments. But one simple request to a lender has in many cases slowed down the foreclosure process and given some homeowners a little breathing room.

It's a little trick that goes back to the heart of how this whole banking mess got started.

During the real estate frenzy of the past decade, mortgages were sold and resold, bundled into securities and peddled to investors. In many cases, the original note signed by the homeowner was lost, stored away in a distant warehouse or destroyed, according to the Associated Press.

Persuading a judge to compel production of hard-to-find or nonexistent documents can, at the very least, delay foreclosure, buying the homeowner some time and turning up the pressure on the lender to renegotiate the mortgage.

Aiken County Master-in-Equity Robert Smoak has for years required lenders to provide a copy of the original note, said officials in his office. A signed affidavit won't work -- it has to be a copy of the real thing.

Next week, for example, there are 40 properties that are scheduled to be sold at auction because of foreclosure. Only two didn't have the note when they filed, and since then one has produced the note, officials said. They don't remember a time when a foreclosure was stopped because the lender couldn't find the note.

But the "Produce the Note" strategy is gaining momentum. Consumer advocates and attorneys across the country have outlined the strategy on websites and in publications. Google "produce the note" and pages of results are returned.

Reports show that more than 2.3 million homeowners faced foreclosure proceedings last year and millions more are in danger of losing their homes.

Aiken attorney Andrew Marine, who specializes in bankruptcy, said that while he's seeming more bankruptcies he hasn't recommended any employ this strategy. Usually by the time a person in financial crisis gets to an attorney it's too late for those tactics, he said.

Usually a lender begins foreclosure proceedings when a homeowner is three months behind on their payments, Marine said. At that time the homeowner is served papers and has 30 days to respond. It's during that time that the homeowner should raise the note question, he said.