Foreclosure ... Mortgage dafault? A secret in the fine print. Keep your house for FREE!

Millions of people in our country are facing foreclosure on their homes and are in dire need of help. Did you know there is a clause in your foreclosure that can actually make your home yours again. And for free!

There have been some programs started up to help some people. But not many qualified for them. Some banks finally offered refinancing with a lower payment to help. But again, only a few qualified. Even with a lower payment, without work, how can anyone pay for their homes?

Over the past couple years, the mortgage liens on our homes have been sold over and over again. Each time a bank or mortgage company goes under, the title to your home gets signed over to someone new. Banks who are still standing have sold millions of mortgage liens for a fraction of their value in an attempt to get out from under bad debt and keep from going down themselves.

But first let us understand how it is all done...

When a bank sells the lien on your home, they typically sell in blocks. Blocks are basically a whole bunch of homes sold at one time. It can be hundreds or even thousands at a time. The blocks are sold in the same way as the goodie bag was sold in stores when we were a kid. They know what all is inside. The purchasing bank or mortgage company doesn't get to investigate each and every home before they buy it when they buy in blocks. They buy the "blocks" and then find out what is in them after they get them.

How do they buy the blocks?

The selling bank and buying bank negotiate. What they are negotiating is how many homes will be in the "block" and how much will be paid for the block. The selling bank may offer homes in a specific area, zip code, or city. Since the buying bank has no idea what each home is, they use statistics to gage what kind of homes they may be and their possible worth. Let's say there is a block up for sale that is listed as being in the 90210 zip code. What this tells the buying bankers is that these homes are large, owned by people who have or had money, were well cared for, and of course....are worth a lot of money.

However, bigger isn't always better...

Now this may sound like the ideal deal right? Not necessarily so. One thing the buying bankers are thinking about is how much money the new buyers of these homes will have to have in order for them to buy these lavish homes. They know they want to sell the homes and make a profit for themselves. This "ideal" deal could actually cause the liens to these expensive homes to be sold for quite a lot less money. On the other hand, if the buying bank can afford to hold onto these homes for the time it will take new wealthy buyers to buy them, then they may be willing to pay a bit more for them and hope for the best.

The same goes for homes in poorer areas. The buying banks are considering the work that may need to be done to the homes in order to sell them. They may be considering that many people will not want to buy in poorer neighborhoods. All these factors can drive down the cost of the block being negotiated.

But over much discussion and negotiating, sooner or later both the buying bank and the selling bank come to an agreement on price and the blocks are sold. Once the blocks are sold, the selling banks send over boxes and boxes of files that include the title and all the mortgage contract papers from when you purchased your home. Now the new bank or mortgage company owns your home and their work begins.

When a bank sells their lien on your home they send you a letter in the mail notifying you. Typically they include who the new lien holder is and their information. But not always. Liens are being sold so fast and in such huge quantity and to so many new investors, that they don't always even know which homes are in each block.

Once the new lien holders go through the boxes of files and discover which homes they now own, they begin their work. The new owner of your home's lien will send you a letter telling you that you now owe your debt to them and the amount that you owe.

The good news is that the new owners do not want you to be foreclosed on with them. They want you to be able to pay for the house so they can begin making their profits. So they give you a couple options to help get this done.

If you are already in default on your mortgage, they may send you a foreclosure notice giving you X amount of days to catch up your payments. Or they may offer you an opportunity to refinance with them and lower your payments. But usually at a higher rate so they can optimize their profits. They suspect that if you are already in foreclosure, then you probably won't keep up on the new payments either. So raising the interest rate makes you more in debt than you already were. However, this added debt will pay off nicely for the new lien holders if you make your new payments on time and keep your home. If they can't get money out of you and feel the home is a loss for profits, then they too may resell your lien to the next buyer, banker, or investor. And off the cycle goes again.

However, nothing in business is ever clean cut and goes exactly as planned. This is where it benefits YOU most. With liens being sold over and over again, and boxes of files being sent and resent to each new buyer, things get...well.......lost.

Lost? Yes, lost. And what gets lost is exactly what can cause you to get your home back, FREE AND CLEAR OF ALL DEBT. Yes, you heard me right. Free of all debt against your home. Now wouldn't that be a blessing from the heavens themselves. And I am going to tell you how and how I discovered this secret.

A couple of years ago one of my best friends was in the same boat as you are. He was working two jobs and still could not pay the mortgage on his home. Over time the bank refused to work with him and eventually pushed him into foreclosure. During the long span of time that it takes to foreclose on a home. And with the vast amount of foreclosures waiting to be heard in the courts, his home's lien had been sold several times. The new owners were now sending him a very long and detailed letter notifying him that he had so many days to come up with the money or they would see him in court to remove him from the home. This particular letter was much longer than the rest he had received when his lien had been sold before. Much much longer. It was full of a tremendous amount of legal terms and jargen. Apparently for a reason we would soon discover hidden in the pages of the letter.

This new very long letter covered many legal topics and terms concerning his home. Since I took pre law, he asked me to read over it for him and decipher its contents into laymen's terms. The first few pages were typical legal talk about his home and loan. Nothing unusual there. But then I came to one of the last pages and stopped. I had to read it a couple times to make sure I was reading it correctly. And I was.

Do you recall how we discussed that things get lost? Well, something had. His original mortgage papers that he had signed when he purchased the home.

It turned out that over the course of the lien being sold again and again, and boxes being moved and shipped to new owners, that they had LOST his original singed paperwork. Getting excited yet? You should be because this is where the part comes in that can get you your home for free.

You see....anytime a contract is signed, the lender keeps the original copy in their records. This original copy of the contract is what the lender will use in a court of law to prove that you signed a debt with them and what you owe. However, if the lender loses the original copy, then they are...how do I word it?......They are screwed!

Once the original document is lost, there is no legal way to prove you ever had a debt with the lender. And if the lender sells the debt, then they are actually selling worthless debt that can not be collected on.

However.....the law has approached this issue and has made it legally possible for the owner of your debt, original or new, to collect on this debt. Of course as with all law, there are legal hoops to jump through and mounds of paperwork to be filed with the courts. But that is ok because this still works in your favor. The lender HAS to notify you in writing that they have lost your original contract and are attempting to reestablish the contract through the courts.

But the good news.....in that same letter, (just like the one received by my friend in foreclosure), if they have lost your original signed mortgage contract, then they have to notify you that they lost it. They also have to notify you of your legal rights. And that by LAW, if you disagree with this debt and demand in WRITING within a certain amount of days, that they produce proof of the debt, then they either have to send you proof, (which obviously they do not have or they would not be sending you notice that they have lost it), or they have to rescind all efforts to collect the debt and you are no longer bound to the debt.

IF in your letter of foreclosure, or notice, that a new bank owns the lien to your house, and the original contract has been lost, and they say this in the letter, then you.....can request in writing that they have to provide you proof of your debt on your home. If they can not do it in the same time frame, then You become the new and SOLE owner of your home, DEBT FREE. They have no choice but to turn the title over to you without any further payments from you.

YES this is correct. You will have the title to your home and owe nothing more on it.

Why? Because remember when the lien was sold over and over again? Well, each time it was sold, the original bank no longer owned your home. Which meant that unless someone new could prove that they now owned your home, the law states that the person residing in the home, and that would be you, is the full and legal owner of the house and the title must be turned over to you.

But the wording is tricky. In the letter you receive telling you that they have lost your original contract, they say it quickly in few sentences and with much legal talk. They do this because they know that if you do not respond in writing within the time given, then the same law that will give you your house for free, will also give them BACK the lien and declare it to be legitimate and you will still owe on your house. The letter is notifying you that there is a court date set with the courts to grant the new lien owner the rights to your house even though they have lost the original contract. And if you do not respond in the time given, that is exactly what will happen.

So how do I respond if I get the letter that they have lost my original contract???

First, read the ENITRE letter they send you. ALWAYS read ALL the letters they send you because, if they know they are going ot have to send you that particular letter, they may try to throw you off by sending multiple letters that "look" like they are the same but one will have that notice in it.

They do this because they know the average person will tire of reading all the letters and just assume that they all say the same thing and stop reading them. It is when you stop reading them all the way through that they will win because you will not respond to the letter that gives you back your home debt free.

If your letter states that they have lost your original mortgage contract, the law will give you typically no more than 30 days to respond. Some states allow only 20 days so read carefully.

1. Read the entire letter to see if it states that they have lost the original mortgage contract.

2. Write a formal letter, typed is best.

3. Address the letter to EXACTLY the same company, address, etc that is listed in the letter as your "respond to" address and person. Make sure this information is IN the letter and not just on the envelope. This will give you proof that you mailed it to the correct person as instructed.

4. In the letter, state your full name, the homes full address, and what you are writing about.

5. Say that you are responding to the letter dated (xx/xx/xxxx) and that per the letter, page XX, paragraph XX, that you are demanding in writing a full and complete copy of the original mortgage contract signed by you.

6. State that if.....You can not provide me with the full complete original mortgage contract for my home at address (list your address),, that I demand by the laws within (list your state) that you cease and desist on any attempts to collect any or future monies from me for the above listed home. Furthermore, I demand that my title be relinquished to me within the time frame given me to respond and that you remove your company from any entitlement for or against the home at address (list your address).

7. Send the letter certified return receipt and make sure it gets signed for.

8. Remember that almost always, your response letter must be RECEIVED within the 20/30/etc day time frame. NOT just mailed. It would be best to overnight it to ensure it does not get lost in the mail system. After all, the $20 fee to overnight the letter is nothing compared to the hundreds of thousands that you are going to save in mortgage payments on your home if you respond in time.

Please pass this link onto anyone you know. This information could help you and hundreds of thousands of people under enormous stress to save their home.

From time to time us "little" people manage to get our hands on some valuable information that helps us all out. Even if you are paying your bills just fine, let everyone know about this and help out your fellow man.