Legal Question in Real Estate Law in California

Your lender is entitled to sell your paper to anyone they like, any time they like. You loan can be enforced by any 'holder in due course', no matter who or where. I suspect they will start foreclosure. You can then try to pay off the mortgage, sell the property, negotiate something with them, or be foreclosed or sued. I'm surprised foreclosure wasn't started long ago, but some banks are delaying doing so for their own reasons that are irrelevant to you. That does not limit their right to do so anytime in the future; there is no time limit on that.

Yes you are legally obligated to the debt collection company. If the mortgage was a purchase money mortgage, meaning made at the time you bought the house and never refinanced, they cannot sue you personally on the debt; they can only foreclose. If the debt has been refinanced, however, they have the option of suing on the debt instead of taking the house (although after they get a judgment for the debt they can then take the house and collect any shortfall from you personally). So what they have done is perfectly legal and enforceable. Here's why: The formal version of what you did when you took out your loan from BofA was give a promissory note and a deed of trust in exchange for the money. A promissory note, usually just called the "note," is a negotiable instrument, in many ways just like a check. The difference is a check is a "demand note," meaning it is payable on demand by the bank on which it was drawn. The promissory note you gave is payable on it's terms, which is monthly with interest, over time. I'm sure at one time or another you have written a check over to someone else by writing "pay to" or "pay to the order of" and the person's name on the back, and then they went and cashed it. By the same method, the holder of a note can transfer the right to payment on a promissory note to any other person or legal entity. Likewise the deed of trust, what you would call your mortgage, is an interest in real property. It too can be bought and sold, like any interest in real property, though it is worthless if you don't own the note with it. Real Time Resolutions is in the business of buying up debts that the lender thinks are worthless or close to it, and trying to get somethin out of them. So it paid BofA pennies on the dollar for your note and deed of trust. BofA endorsed the note and deed of trust over to RTR, and now RTR owns the debt and all the rights that go with it.

Mr. Nelson is correct. A promissory note is generally negotiable, and the original lender can resell the note to anyone, in any state, in any business, at any time, without your approval, and without notice. Further, the collateral follows the obligation, meaning the current holder of the note is also entitled to foreclose on the collateral in the event of default. Of course, the Texas company will have to follow all California laws and procedures when it begins foreclosure, starting with recording and serving a Notice of Default. I wouldn't be surprised if the paper was sold at a substantial discount and the buyer is in the business of speculation.

Unfortunately yes, it is a debt you made a written promise to pay, it does not really matter to you who is now holding that written promise you made. However, there is always different options to renegotiate that debt including a loan modification, or even a short sale which might work out better for you. But, the worst thing you could do is do nothing because that will give the bank more time in which to initiate foreclosure on you. Once a sale date is set it becomes much harder, although not impossible to negotiate. Please seek help immediately. We are available at 323-549-9385 or at [email protected]. Good luck!