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Questions about Notice of Default (NOD)

Notice of Default occurs when payments have become past due. Individuals can be uncertain of how to handle or dispute these NODs. Uncertainties of NODs and the process of dealing with NODs often lead to questions like the ones answered below.

I received a Notice of Default (NOD) letter from my mortgage lender, giving me 30 days to dispute or pay full amount. How would I proceed with requesting a lower monthly payment to keep my house?

In order to request a lower monthly payment you would need to reach out to the lender and request a lower payment or a modification. It is the lender’s discretion as to whether or not they will consent to a change in terms, payment amount, or wave the late fees. If you have already received the notice of default letter you either have to pay what is owed, or you can seek refinancing with a third party, if possible.

In California, when a lender has a notice of default filed and then they sell the note to a new lender, does the NOD stay in force, or does a new have to be filed under the new lenders name before they can go to sale?

In California, for a lender to establish a valid foreclosure they must be able to meet compliance with California Comm. Code 3-301. This will need to be done at the start of the foreclosure proceedings, the recording of the notice of default, and during the proceedings until the sale date.

If the new owner of the note did not have possession of the note at the time the first NOD was filed, then the new owner of the note would have to refile the NOD.

After receiving a Notice of Default and Notice of Trustee Sale I filed for Bankruptcy and during that time the bank postponed the Sale date 3 times and then dropped it. How long does the Notice of Default stay in effect?

When an individual files for bankruptcy protection, the bankruptcy court issues a stay, which stops the foreclosure process right where it left off. Only when the bankruptcy court lifts the stay can the lender continue where it left off in the process. The lender would not need to issue a new NOD. They would only need to give a new notice of sale and set a new date.

A trustee's sale is scheduled in 2 days. The Notice of Default does not include a statement stating the borrower was contacted or attempted to be contacted as detailed in CA Civ. Code 2923.5. Does that nullify the NOD?

Failure to follow the requirements of Civil Code 2923.5 can be used to temporarily postpone a trustee’s sale while the lender fulfills the requirements of the statute. However, it would not nullify the NOD or Notice of Sale. Once the lender has fulfilled the requirements of the statutes it can foreclose.

I had a NOD filed a few years ago, the bank began foreclosure process and then I received a notice of recession. What does this mean?

A Note of Recession means that the default has been fixed by either the arrears in payments being caught up to date by the homeowner and/or a refinance. When the notice of recession is recorded it does cancel the Notice of Default. If this happens then the homeowner can sell the property as though they never had the NOD because the foreclosure action was terminated.

Having the right information and understanding of a notice of default can help when dealing with questions regarding NODs. Experts can help answer questions about NODs problems or share the steps involved in obtaining a notice of default.
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