Foreclosure in Los Angeles>Question Details

Maggie, Home Seller in Los Angeles, CA

I had 2 lien holders on my foreclosed house. My house got foreclosed in 2010 around May to June. The 1st lien holder (Gmac) has wiped out the loan

Asked by Maggie, Los Angeles, CA Thu Feb 9, 2012

but the 2nd lien holder (Chase) keeps asking for money. They have also passed the loan to a collection company and now they keep calling for Money and threaten us if we don't pay and then we might file a lawsuit.
My second loan was not a personal loan. Do we need to pay them back even my house got foreclosed? Your prompt reply will be greatly appreciated! Thank you!

Help the community by answering this question:


I have an excellent attorney that specializes in these situations.
Please contact me and I will put you in touch with him.

Tim Jarnot – Branch Manager
Westline Partners at Trimax Realty Inc.
1 vote Thank Flag Link Thu Feb 9, 2012
Consult with an attorney, second liens have a tendency of trying to collect from the homeowner. You may have to resort to a bankruptcy if all else fails.
0 votes Thank Flag Link Sun Feb 26, 2012

You need legal help to find out. The laws have changed over the last few years and they can tell you what the laws were at that time, and how to handle it.

I hope it works out for you,

0 votes Thank Flag Link Sat Feb 25, 2012
I am familiar with this situation.
If you would like to contact me I can refer you to an attorney that SPECIALIZES in these types of situations. his fees are very reasonable and he is very responsive.

Tim Jarnot - Broker
TD Pacific Investments
(310) 795-7807
0 votes Thank Flag Link Sat Feb 18, 2012
Hi Maggie:

Consult with an attorney. You also have the option of filing bankruptcy to wipe out the 2nd and any other debt that you may have accumulated. Seeing that you have a foreclosure already, this may be a viable option for you. What do you have to loose? Again, consult with an attorney.

Good luck!

All the best,

Kat Becker, Realtor
Prudential California Realty
0 votes Thank Flag Link Tue Feb 14, 2012
Maggie, once more, contact a lawyer to review your situation.

The lawyer will be able to confirm whether you do or do not owe the 2nd anything based on whether the 2nd was AND REMAINED a non-recourse purchase money loan. If you do not owe anything the lawyer can help to stop the collection calls and if you do owe a balance can negotiate a possible settlement.

In you most recent post you state:

"The loan was definitely a purchase money loan. It was used to buy the house."

My understanding is that if a senior lienholder forecloses on a property the "wiped out" junior lienholder who no longer has a secured note MAY NOT sue on the promissory note if in fact if it was a Lender/Seller non-recourse purchase money loan. HOWEVER, refinancing the 2nd would have REMOVED the non-recourse protection!

0 votes Thank Flag Link Fri Feb 10, 2012
Hi Jonathon,

The loan was definately a purchase money loan. It was used to buy the house. That's why I don't understand why Chase still comes after me. However, some people said they have the right to come back and they said don't. My biggest concern is would chase file a lawsuite to force us to pay them back?
0 votes Thank Flag Link Fri Feb 10, 2012
The Best advise you could get is from an attorney but some basic knowledge is this. If the loans were purchase money loans(meaning loans that were used to buy the house then they can not come after you for the deficiency). If you took out money against your home, ie line of credit then they can come after you for the total amount owed and you be in your best interest to either settle the debt or like many right now file for a chapter 7 bankruptcy. If you want the number to an attorney I direct many of my clients to to help them with these cases please let me know.

Jonathon Villaescusa
Excellence Real Estate
Cell: 562-652-7667
Web Reference:
0 votes Thank Flag Link Fri Feb 10, 2012
Great answers given. Your collateral is gone and now they are after you. It sounds like a recourse debt. If you want help in settling this account you can get more help by calling this number (888) 913-4910. You may also want to address this question to a legal counsel by visiting web reference below and clicking at "Ask a Lawyer" all the way at the bottom of the site; it's free.

Have a blessed day,

Doug Perez
0 votes Thank Flag Link Thu Feb 9, 2012
You definitely need to seek legal advice from an specialist in this area of hardship.
Good Luck.
Web Reference:
0 votes Thank Flag Link Thu Feb 9, 2012
You took out a loan using your house as collateral. The collateral is gone but you are still obliged to repay the loan. That is my quick take and should not be construed to be legal advice or even correct. That is why you should see an attorney to discuss your rights and what action you should take to protect yourself against the actions of the collection agency.
0 votes Thank Flag Link Thu Feb 9, 2012
My associates are correct you should get legal advice because you don't have the "purchase money protection" you would have had if the loan was from the original purchase.
If you need low cost assistance try
0 votes Thank Flag Link Thu Feb 9, 2012
later. I bought my house in 2005 and refinanced in 2006.
0 votes Thank Flag Link Thu Feb 9, 2012
Don't leave this unattended. Did you take the second loan at the time of original purchase or later?
0 votes Thank Flag Link Thu Feb 9, 2012
Hello Maggie,
As a Certified Distressed Property Expert, I hope you would have done a Short Sale. As of right now the 2nd lien absolutely has the right to go after you. remember that this is an unsecured debt, no different than you owing money to your uncle per say. I suggest you get in touch with a qualified legal Counsel who can help you in this matter. They will charge you money. If this was me I would have negotiated with the collections agency myself and if they did not want to take what I offered them then the other options I would have looked into was to retaining an attorney or even file BK if it made sense.
A collection agency acquired this debt for pennies on the dollar you may offer them 10-33% TO SETTLE THIS DEBT.
cALL ME AT 818-919-5656 If you need more info. Wish you luck.
FOr all those out there reading this who are behind on payments,Don't get foreclosed upon. Ask for help. Short Sale protects you . Know your options before you decide to walk away.
0 votes Thank Flag Link Thu Feb 9, 2012
Maggie I am sorry this is happening to you. However, this is a legal matter..If you wish a referral just give me at call 951.538.4126...Please know there is help for you..
0 votes Thank Flag Link Thu Feb 9, 2012
Hi Maggie,
When a home is foreclosed, the second lien holder's collateral is wiped out but not the loan. Rather the second loan is recourse or not (as Steve mentioned) is a legal matter.
Good luck,
0 votes Thank Flag Link Thu Feb 9, 2012

This is a legal matter. Seek legal advice regarding your situation immediately. -Steve
0 votes Thank Flag Link Thu Feb 9, 2012
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2016 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer