"Produce the Note" Defense in Foreclosure

In the "produce the note" defense, the homeowner demands that the foreclosing bank demonstrate that it has the legal right to foreclose.

During the foreclosure crisis, homeowners were regularly able to successfully raise a "produce the note" defense to fight their foreclosure. A produce the note defense is based on the legal principle of "standing"—that is, who has the right to foreclose. While this defense is no longer particularly effective in most cases, your case might be the exception.

Read on to learn more about the produce the note defense and learn whether you're likely to be successful if you make a standing argument when fighting your foreclosure.

Understanding Promissory Notes

When you took out your loan, you signed both a mortgage or deed of trust and a promissory note. Homebuyers sometimes think of the mortgage or deed of trust as the contract they're signing with the bank to borrow money. But it is the promissory note that contains the promise to repay the amount borrowed.

When the loan is sold to a new owner, the promissory note is endorsed (signed over) to the new owner of the loan. The owner of the note or its representative is the only party that has the legal right to collect the debt if the borrower doesn't make payments. In some cases, the note is endorsed in blank, which makes it a bearer instrument under Article 3 of the Uniform Commercial Code (UCC). This means that any party that possesses the note has the legal authority to enforce it.

Assignments, on the other hand, transfer the mortgage or deed of trust and are typically recorded in the land records.

The Produce the Note Defense

In the "produce the note" defense, the homeowner demands that the foreclosing party produce the original noteor prove in some other way that it is the true owner of the noteto demonstrate it has the legal right to foreclose. Some courts allow a copy of the note to suffice.

During the great recession and concurrent foreclosure crisis, attorneys representing homeowners used this defense to stop some foreclosures. The defense often worked because producing the note was usually difficult. In many cases, the debt had been sold to different banks and investors, sometimes over and over again. Every so often, the new owner of the loan didn't get the proper paperwork to show it owned the note and mortgage. Even in situations where the original note was available, the endorsements might not have been in order.

These days, however, banks and investors are more careful about addressing any gaps in the paperwork before initiating a foreclosure. Also, courts all over the country have heard many cases on this issueagain, called "standing"and have decided against homeowners in many situations. It is now much more difficult to win your case based on a produce the note type of argument.

Lost Note Affidavits

If the note has been lost, destroyed, or is otherwise unavailable, the foreclosing party will frequently use a “lost note affidavit” to try to avoid the problem of not having the original note. This affidavit is a sworn legal statement in which the bank states the note is lost or destroyed, or something similar, but that it is the true and rightful owner of the note and thus has the right to foreclose.

In many cases, the court will find a lost note affidavit to be sufficient and allow the foreclosure to proceed. So, unfortunately, it's often an uphill battle for homeowners to use a produce the note defense. Whether a lost note affidavit will suffice in allowing the foreclosing party to proceed with a foreclosure in your case depends on your situation, your jurisdiction, and the court.


The issue of standing is complicated and the law varies between states. In some courts, the foreclosing party must establish that it holds the note or is acting as the note holder’s authorized representative in order to to foreclose.

When it comes to assignments of mortgages (or assignments of deeds of trust), many courts follow the general rule that the mortgage follows the note. This means that when the foreclosing party has the right to enforce the note, a recorded assignment of the mortgage might not be needed. But in other states, there must be a valid assignment or else the foreclosure can't go forward.

Why Standing Is Important

If you have reason to believe that the party that's foreclosing on your home isn't the actual owner of the loan, and doesn't have the right to foreclose, but you don't challenge it, the court will not won't eexamine this issue as part of a judicial foreclosure. In the case of a nonjudicial foreclosure, the foreclosure will simply proceed.

How to raise a standing defense in a judicial foreclosure. In a judicial foreclosure, the bank files a lawsuit in state court. You'll receive a foreclosure complaint, petition, or similar document, along with a summons. In this type of foreclosure, you can raise the issue of standing as part of that lawsuit.

How to raise a standing defense in a nonjudicial foreclosure. With a nonjudicial foreclosure, the bank can foreclose without going to court. So, you'll need to file a lawsuit to bring up this issue.

Consider Talking to an Attorney

You’ll most likely need an attorney to help you review your ability to raise a defense based on standing and argue it in court if you decide to go this route. These days, you will most likely be setting yourself up for frustration if you simply demand that the foreclosing party "produce the note."

Also, any given foreclosure or legal situation has many potential claims and defenses, and you might be missing other legal claims that you could bring as a defense to the foreclosure action if you decide to proceed without an attorney's assistance. It's recommended that you seek the advice of local counsel or a legal aid organization to explore all possible defenses that could be available in your particular situation.

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