New Jersey Judge Blocks Foreclosure When Mortgage Note Not in Hand of Lender

HNWReal Estate, Landlord/Tenant, and Zoning

A New Jersey Bankruptcy Judge recently disallowed a Proof of Claim by the lender on a Mortgage in default who was seeking to enforce the Note but did not acquire the Note until after the Proof of Claim was filed.   Says Fredrick P. Niemann, Esq., a New Jersey Foreclosure Law Attorney, there is an increasing trend both nationwide and in New Jersey to stay foreclosure actions or require that the lender refile a Foreclosure Action if they cannot prove that the Note was in possession at the time the foreclosure action was initiated.  

 Prior to these recent line of cases, the thought was that a court of equity would allow a lender to remedy the technical possession requirement by reference to collateral sources says Mr. Niemann.  Now defense attorneys in Foreclosure actions will contemplate the filing of a contesting answer to require the lender to prove the existence and possession of the note at the time of filing the foreclosure complaint.   Should you have any questions concerning foreclosures and mortgage modifications, contact Fredrick P. Niemann, Esq., at (888) 800-7442 or e-mail him at

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