STIPULATION OF DISCONTINUANCE
WHAT IS A STIPULATION OF DISCONTINUANCE?
If a borrower settles a foreclosure action with his or her lender, the parties will sign a stipulation of discontinuation to end the foreclosure action. Lawyers call it a “stip.” The stip gets filed with the Court to complete the case. If the case is settled by a loan modification, there will be a stip of discontinuation. The borrower/homeowner will want the stip to be “with prejudice” which means that the lender cannot sue again based on the same loan default.
In addition to the stipulation of discontinuance, which applies to all cases that are settled, in the context of foreclosure actions, there is also a stipulation to remove or vacate the lis pendens. The homeowner will want to make sure that the lis pendens is no longer on the property once the loan is restructured or reinstated.