Lender of Foreclosure is purposely withholding Payoff statement

[James Grasty]

I have a predicament and did a search, but could not find anything dealing with this particular situation.

I am purchasing a home in foreclosure from a friend and am buying it via a new first mortgage through a escrow company.  The issue is that the existing lender is purposely withholding the payoff statement (over a month now) so the home can not closed and be sold.  The home has a substantial amount of equity in it (Owes aprox $70k worth $150k) it would seem the lender would rather drag their feet to try to complete the foreclosure.   

I have been told that they can not by law withhold a payoff statement, so what can I do to get them to release it and help the sellers get left with nothing? 

Your help is greatly appreciated

Cheers!

James