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  1. #1
    Join Date
    Mar 2009
    Posts
    7

    Unhappy Two Loans: Second Loan Was Refinanced

    My question involves a foreclosure in the State of: CA

    I can no longer afford my rental property and am thinking of foreclosure. I bought this house in 2005 with 2 loans; lived there until renting it out in July 2008. I bought our primary residence in Aug 2008.

    I refinanced the 2nd loan that was originally $132K for $170K.

    My questions are:
    -is this considered non-judicial foreclosure
    -can the 1st loan lender and 2nd loan lender come after me

    I am afraid of the impact.

  2. #2
    Join Date
    Apr 2008
    Location
    Texas (Dallas area)
    Posts
    1,404

    Default Re: Two Loans: Second Loan Was Refinanced

    Quote Quoting lelehm526
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    My question involves a foreclosure in the State of: CA

    I can no longer afford my rental property and am thinking of foreclosure. I bought this house in 2005 with 2 loans; lived there until renting it out in July 2008. I bought our primary residence in Aug 2008.

    I refinanced the 2nd loan that was originally $132K for $170K.

    My questions are:
    -is this considered non-judicial foreclosure
    -can the 1st loan lender and 2nd loan lender come after me

    I am afraid of the impact.

    If the first loan was never refinanced the lender can not come after you for a deficiency in CA.

    The second loan will most probably take a total loss. Since it is a refinanced loan they can come after you and file a deficiency judgment against you for the entire amount plus legal costs and interest.

    All mortgages are foreclosed now in CA as non judicial. The process is very fast.

  3. #3
    Join Date
    Mar 2009
    Posts
    7

    Question Re: Two Loans: Second Loan Was Refinanced

    My refinanced 2nd loan deed of trust had the "power of sale" words in it. Doesn't this make the foreclosure on the 2nd loan "non-judicial"?

    If not, this means that the 1st lender can foreclose as non-judicial while the 2nd lender can foreclose as judicial?

    I am a bit confused. I thought if the mortgage forecloses as non-judicial, the lender cannot come after me.

    And if the 2nd lender forecloses as judicial and come after me for the full amount, what can they do exactly? I bought my main home in Aug 2008 (co-owner, then married in Nov 2008) and mortgage is $500K buying it with 20% down in 2008. I acquired the 2nd refinanced loan in 2007 when I was single. But can they affect this mortgage? Would they also garnish my paycheck? I already received my Federal income tax return but still waiting for my state income tax return. Would they take this?

  4. #4
    Join Date
    Apr 2008
    Location
    Texas (Dallas area)
    Posts
    1,404

    Default Re: Two Loans: Second Loan Was Refinanced

    Quote Quoting lelehm526
    View Post
    My refinanced 2nd loan deed of trust had the "power of sale" words in it. Doesn't this make the foreclosure on the 2nd loan "non-judicial"?

    If not, this means that the 1st lender can foreclose as non-judicial while the 2nd lender can foreclose as judicial?

    I am a bit confused. I thought if the mortgage forecloses as non-judicial, the lender cannot come after me.

    And if the 2nd lender forecloses as judicial and come after me for the full amount, what can they do exactly? I bought my main home in Aug 2008 (co-owner, then married in Nov 2008) and mortgage is $500K buying it with 20% down in 2008. I acquired the 2nd refinanced loan in 2007 when I was single. But can they affect this mortgage? Would they also garnish my paycheck? I already received my Federal income tax return but still waiting for my state income tax return. Would they take this?
    All mortgages are foreclosed in CA as non judicial. Even if the second lender forecloses (probably wont happen as the loan will be removed when the first lender forecloses). The second lender has the right to sue you for a deficiency judgment to which you have no defense in court. These are pretty much open and shut cases.

    Yes, your second loan can be foreclosed as NON judicial as there is a power of sale clause. Both of the loans first and second are foreclosed NON JUDICIAL.

    Loans are foreclosed now under the MERS system to avoid the confusion.

    Here is a link to Mers;


    http://www.mersinc.org/index.aspx

    They can only sue the person who signed the mortgage. Even if you where married after the loan was issued that does not matter.

    In CA they can attatch to your bank accounts and garnish you as well. You may want to consult with a bankruptcy attorney as this type of debt is dischargable in a BK. You can put it behind you and move on with your life.

  5. #5
    Join Date
    Mar 2009
    Posts
    7

    Default Re: Two Loans: Second Loan Was Refinanced

    I want to make sure I understood correctly...

    Since the refinanced 2nd loan has the "power of sale" in the deed of trust, the foreclosure process will be NON-JUDIDIAL. Therefore, the lender cannot come after me for deficiency.

    I am somewhat confused since your first paragraph response says they can sue me.

    I will definitely consult a lawyer. I just wanted to have some understanding before I do...and you've greatly helped. I've read through other similar threads and been following your responses to them. Since none of them quite gave me the answer I need for my situation, thought I'd start my one thread.

  6. #6
    Join Date
    Mar 2009
    Posts
    7

    Default Re: Two Loans: Second Loan Was Refinanced

    One more thing, if they can only sue me, would they go after any joint checking/savings account?

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