If the note is the contract Parties evidence in bargain and acceptance, enforceability would lean towards better judgment. There are alternative evidentiary for a “lost Note” that include the ABA Wire and HUD. Both are conclusive and are quite easy to bring into a controversy and sway a court. This assumes both are found in the borrower’s original files. Laws that prohibit destroying a note are not at question as are entitlement and enforceability…. Should the note be destroyed. It’s not an operation of the law, whereupon even UCC conditions enforceability and not necessarily willful destruction. (citation) Also, if the note rate emerges significantly higher over time in tune with the open market and due to the shift in cost of funds, the note becomes more valuable and marketable. Its marketability becomes impaired when the note is lost.
Does the borrower have the right to demand to see the original note and all allonge prior to and as a condition of making each and every payment toward satisfaction of the note?
Let me say this…. I bought and sold impaired assets “problem loans” all the time. We were often forced to accept a lost note affidavit. It had no impact on the maker s obligation. In the above example, if the note were sold and the new party forgets to issue a servicing “hello” letter that is a servicing disclosure issue that can cause controversy for the true beneficial interest. It goes back to the old adage; first in line is the first to record. The first to record is the first to satisfaction. The line is where satisfaction comes into play
Does a rubber stamp “paid in full without recourse” on the face of the note actually render it paid in full and relieve the borrower of the obligation to make further payments? If not, why not?
Wow, huge question and something that the entire universe of attorneys on the consumer’s side has failed to pick up on. I say yes, satisfaction is not conditioned by source and use of funds. And each of these loans upon origination are delivered into an in an SPE. If delivered prior to a business trust sealing the vault – they could never be shown as Paid- Off! After is a whole different story and the information is just not something the attorneys I work for are unwilling to allow me to release at this point in time.
There is a reason the loan s stamped Paid in Full
A reason for MERS as I have said (make it an ally)
Most important, I believe yes, satisfaction from whatever and wherever the means are applied is satisfaction and constitutes a release of lien
It’s foolish to think the lender would not come after you in a different venue or jurisdiction under a civil action seeking to be remunerated. Now however, you’re talking about an unlimited civil action and likely to find an ex parte motion to slap Lis pendants on the subject matter realty in question…..within 48 hours of filing.
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