Conversation w/ mortgage broker

[dalrex]

Just had a conversation today with a mortgage broker that I know and do business with. I asked him if he knew what the bank did with the promissory note from a new mortgage. He said that the banks don't use promissory notes for mortgages anymore, they use demand notes. This way, they can demand payment at any time... I thought that was an interesting tidbit, but I am sure they still monetize those demand notes!!

He said the "note" gets sent to the processing department, which "processes" it and puts it on microfilm. He said that he was not aware of what happens there other than that.

I then asked him where the money for the mortgage come from. He said from the deposits and such from customers...

I told him that is what they want you to think, and that I found out different! The conversation went on, but I truly believe that he has no idea! He said that he would like to know what I am finding out. I told him that we would go for coffee sometime soon!

The reason that this all came up was because I asked him if he knew any bankers that were high up the ladder that I could meet with. He didn't really know any in our city, and the ones that he deals with are usually in other cities where the head offices are...

I can't wait to see what his reaction is when I take him for coffee

[TheBlackTruth]

<font color=darkblue face=verdana>1) I just executed a new mortgage 2 weeks ago and they definitely used a Promissory Note so thats evidence its surely not an industry-wide standard - at least not yet.



2) Any "promissory note" is due on demand if there is no due date certain printed on its face. So even a "demand note" is a sub-class of promissory note. I would assume they are handled in the same way - stamped and deposited.[/color]

[test]

Someone mentioned to me the other day that in the mortgage contracts in small letters there is wording saying that the bank can demand full payment at any time during the life of the mortgage.



This was in Florida.

[charlesa6]

The time the bank can demand full payment if you are in the default for none payment of your mortgage.

Originally Posted by test

Someone mentioned to me the other day that in the mortgage contracts in small letters there is wording saying that the bank can demand full payment at any time during the life of the mortgage.



This was in Florida.

WHAT THEY TIPICALLY DO IS ACCELERATE THE NOTE AND DEMAND FULL PAYMENT AFTER YOU HAVE DEFAULTED. I'M IN A DEED OF TRUST STATE AND AFTER MISSING 3 PAYMENTS THEY SEND YOU A NOTICE OF ACCELERATION WHICH INCLUDES 4 PAYMENTS PLUS LATE FEES. IF YOU FAIL TO PAY THAT THEN PRE-FORECLOSURE PROCEEDINGS BEGIN.

ONCE IN PRE-FORECLOSURE, THE BANKS ATTORNEY (TRUSTEE) SETS A SALE DATE BUT YOU CAN STILL REINSTATE THE LOAN IF YOU PAY THE ENTIRE ARREARAGE (5-6 MORTGAGE PAYMENTS PLUS ATTNY FEES, ETC). THIS IS MY GENERAL UNDERSTANDING OF THE WHOLE PROCESS.