States can claim Short sale deficiency charge from seller in 20 years?

Asked by Bs, San Jose, CA Tue Oct 4, 2011

Please advise that if CA is one of the 41 states that can claim Short Sale deficiency amount back from the short sale seller in 20 years? Thank you!

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13
Steven Ornel…, Agent, Fremont, CA
Wed Oct 5, 2011
BEST ANSWER
Bs:

In CA a Lender can refuse a Short Sale request and instead seek a Deficiency Judgment against the owner via the Judicial Foreclosure process.

You can read more about this here:
http://www.foreclosurelaw.org/California_Foreclosure_Law.htm


SB931 is the OLD "Short Sale Law" with an effective date of 1/1/11 thru 7/15/11. The law prevented a deficiency judgment after a short sale in most cases; however, it only covered First Trust Deeds on one-to-four residential units.

SB458 became law on 7/15/11. This law prevents a deficiency judgment after a short sale in most cases on ANY Trust Deeds on one-to-four residential units. You can read more about the new law here:

"CA Senate Bill 458 Now Prohibits 1st/2nd Deficiency Judgments*"
http://www.trulia.com/blog/steve_ornellas_mba_re_mastersgri/…

-Steve
1 vote
Paul Rinde, Agent, Menifee, CA
Wed Oct 5, 2011
As others have said SB931 currently protects a seller from deficiency judgement. Do you know someone who is having some financial trouble?
1 vote
Buyinhouse, Home Owner, San Jose, CA
Mon Aug 27, 2012
There have been more than one "Strategic default" lately in CA alone, so, if what you ask is true, why did they end up buying a home at the same time they defaulted or say 2 years later when their credit score was repaired? Lenders don't like anybody with a debt of a few $100,000's, do they? They would make the wannabe buyer to pay it off.

Does it sound reasonable to you?
0 votes
Bs, Landlord, San Jose, CA
Mon Oct 10, 2011
Thank you for all answers. Actually, I am a Short sale/REO house buyer. I just want to know the new policy and watch the possibilities to affect the buyer's interests.
0 votes
Steven Ornel…, Agent, Fremont, CA
Sat Oct 8, 2011
Bs: I wholeheartedly agree with Charles. In addition, if you would like to receive a "Q&A" on the topic of deficiency judgments produced by CAR please contact me offline. The information will be a subject primer and will not substitute for the advice of a lawyer based on the specifics of your situation; however, it will save you time asking questions once you do meet with a lawyer.

Best, Steve
0 votes
charles butt…, Agent, san jose, CA
Fri Oct 7, 2011
Good evening Bs:

if you are threatened by the possibility of a deficiency judgement, that is a very serious legal issue and you DO NEED an Attorney!!!

I recommend that you talk with a very good Real Estate Attorney if that is the case.

I recommend that you talk with Ron Rossi or one of his associates. Ron Rossi is an excellent Real Estate Attorney and is THE EXPERT on the subject of deficiency judgments.

You can reach Ron Rossi at his office telephone number (408)261-4252.

Thank you,
Charles Butterfield
Real Estate Broker/REALTOR
American Realty
Cell Phone: (408)509-6218
Fax: (408)269-3597
Email Address: charlesbutterfieldbkr@yahoo.com
DRE#00901872
0 votes
Bs, Landlord, San Jose, CA
Wed Oct 5, 2011
Hi Shanna:

I googled "California SB931", which does not mention about deficiency charge from seller in 20 years. Please advise. Thank you again!
0 votes
Bs, Landlord, San Jose, CA
Wed Oct 5, 2011
Hi Gabriel:

Google "House Is Gone but Debt Lives On ."
http://online.wsj.com/article/SB1000142405311190406060457657…

Thank you for all the answers.
0 votes
Ron Thomas, Agent, Fresno, CA
Wed Oct 5, 2011
Not only have I not heard of this, I doubt it very seriously!

I cannot believe that a politician would write something that would kick-in in TWENTY YEARS!

That's absurd.

There are a lot of exaggerations and un-truths floating around nowadays. Don't believe them.
0 votes
Gabriel Nguy…, , Campbell, CA
Wed Oct 5, 2011
Shanna,

California SB931 does not mention about deficiency charge from seller in 20 years. I don't see it after Google it.
0 votes
Scott Godzyk, Agent, Manchester, NH
Wed Oct 5, 2011
I have never heard of this as well. Each state has their own laws regarding collections which i have seen from 2 years to 7 years and alot have a forgiveness act as well.
Web Reference:  http://www.ScottSellsNH.com
0 votes
Shanna Rogers, Agent, Murrieta, CA
Wed Oct 5, 2011
Hi Bs,

I've never heard of this. Refer to CA law SB931 - you can Google it. It is the new CA Short Sale Anti Deficiency law.

Shanna Rogers
SR Realty
http://www.RealtyBySR.com
0 votes
Gabriel Nguy…, , Campbell, CA
Wed Oct 5, 2011
Huh.... Who said that? Can you send me the link where it comes from? This is something new that I don't know.
Web Reference:  http://4reohomes.us
0 votes
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