New Foreclosure Law In California
July 30th, 2008
New Foreclosure Law In California
Question: Foreclosure and Lender recourse?
My fathers house is going into foreclosure in California. He has a 1st of $375k and a 2nd Heloc of $50k. He received these two loans after a refi in 6/07. The refi only left him to receive $5k cash out that was all that was left in the Heloc the rest was used up in the loan itself and when back to pay the bank. Both loans are with the same lender. I know in Calif. there is a law that says the bank cannot put a judgement against you if it is your primary residence. Do does that mean that the only recourse they have is to use the property to satisfy the date?
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Answer: What the California law states is that there is no recourse only if there has been no refinance. What this basically means that if you are on your original mortgage, if the house is foreclosed upon and the bank sells it for less that the loan amount, the bank cannot come after the debtor for the remaining balance. In this case, since your father has refinanced the original mortgage, it would seem that if the lenders want to come after your father for payment of the debt (assuming that the house sells for less than the total balances on the two mortgages) they will be allowed to seek judgment.
It's Your Call - New Foreclosure Scams
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Posted in Foreclosure Laws | 
Tags: california, California Foreclosure, California Law, economics, Foreclosure California, Foreclosure Law, housing, realestate, urbanism
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