Foreclosure in Solano County>Question Details

Antoinette39…, Renter in Solano County, CA

Vallejo, Ca. I lost my home to foreclosure, the 1st auctioned the home. how do i get out of paying the 2nd?

Asked by Antoinette3939, Solano County, CA Tue Jan 3, 2012

2 and a hald years ago we lost our home, in the end they had us paying $6500 a month, and we couldn't breath any more so we left and they auction off the home which was worth I thing $338000 and they sold like for $289000. so the 1st was paid off and left us with a 2nd mortgage, i dont know why they didnt auction for the full amount????HELP HELP HELP, NOW WHERE STUCK WITH TRYING TO PAY FOR A HOME WE DONT HAVE IT ABOUT $65000

Help the community by answering this question:


California is a NON-RECOURSE state:
The holder orf the 2nd can bully and bluster, they can call you all the time, but they cannot sue you.
Be sure that they do not put anything more on your Credit Report; tell them that you will sue them.
If they persist, call a Real Estate Attorney; it will be cheaper than paying them.

Good luck and may God bless
1 vote Thank Flag Link Tue Jan 3, 2012

I also believe that Ron's answer is incorrect. From what I have been told there is only one case where this would hold true, and that is if the 2nd was a "purchase money" loan.

What many people do not understand is, when you borrow money to buy a home you sign two documents: (1) A note - which is a promise to pay and (2) A Deed of Trust - which is a pledge of your home as collateral for the promise to pay and creates a lien against your property. In a foreclosure, all junior liens are wiped out, but not the note. So the promise to pay stands even though the collateral no longer belongs to you.

You need to contact an attorney to find out if you actually owe this money. If you do, you might be able to negotiate a settlement with the lender for significantly less than what is owed. If you would like a referral to a great attorney, or if you want to discuss the specifics of your situation further, please feel free to contact me directly.

Good luck and Dare to Dream.

Shel-lee Davis, QSC®
Certified Distressed Property Expert – CDPE®
Short Sale & Foreclosure Resource – SFR®
Certified HAFA Specialist – CHS®
SSG Pro®
Your Real Estate Consultant for Life
RE/MAX Palos Verdes Realty
424-2HELP12 (424-243-5712)
0 votes Thank Flag Link Wed Jan 4, 2012
I believe that Ron’s answer is incorrect. So…one of us is wrong. You need to talk to an attorney who will be the tie breaker since neither Ron nor I are competent to give you the legal advice that you need.
0 votes Thank Flag Link Tue Jan 3, 2012
The bid amount at the auction on your first loan should be equal to the loan balance plus fees, attorney costs, etc. The value of the home has nothing to do with the auction. If the property were to be sold for more than the bid amount then any additional monies would be paid to the second loan.

If the second loan was taken out after you purchased the home as a HELOC or for any purpose other then purchasing your home when you originally took possession the lender has the right to pursue you for the deficiency. They will obtain a deficiency judgment against you and begin their pursuit in collecting whatever they can.

Your best bet is to talk this over with a real estate attorney or tax advisor in order to plan how you need to deal with this. Many of my clients end up filing bk to wipe out the debt. Not fun but you don't want to be left dragging around a constant reminder of the past like a ball and chain around your ankle. Just deal with it swiftly and without looking back. Life goes on!

Good luck to you and happy new year!

Diane Wheatley, Broker

This is not to be construed as legal advise. Please consult with the appropriate professionals educated and trained in these types of scenarios for proper guidance.
0 votes Thank Flag Link Tue Jan 3, 2012
You might want to consult with an attorney with regard to the information that has been provided. Our understanding and experience with non-recourse refers to the first mortgage. We have many customers from CA and most of them have second mortgage judgements against them.
Our advise to people being pursued for monies they do not have is to show the collector that there is no money for them to pursue and it would be a waist of their time and money to continue to pursue a noncollectable debt. A CPA certified personal financial statement usually works well.

Good Luck
Bob Patrick
Buy home after foreclosure, short sale, deed-in-lieu-of or bankruptcy expert
Movin-On LLC
Helping families/people that have lost their homes get back into another in as little as 6 months
0 votes Thank Flag Link Tue Jan 3, 2012
@Ron is correct. Ignore them! Whatever you do, do not make any payment arrangements with them or take any action without talking to a attorney. Without intending to provide you any legal advice, please know that there are certain "triggers" that you just may set in motion if you give the collector any money. I would not risk it. Basically tell them to "pound salt".
0 votes Thank Flag Link Tue Jan 3, 2012
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