Legal Question in Real Estate Law in California

My home in CA foreclosed in 2011, i had two loans on it (both purchase money loans). the 2nd loan is showing as a charge off on my credit report. Can this charge off designation be removed? it is affecting my current refinance on my current home loan. why does the first show as foreclosure and the 2nd show as charge off?


Asked on 7/18/16, 11:51 am

1 Answer from Attorneys

It sounds like your credit report is accurate. It sounds like the first foreclosed. That wiped out the lien of the second. Since it was a purchase money loan on a residence, that also wiped out any right to collect directly from you as an unsecured debt. So they charged it off as an uncollectable debt, converting an account receivable asset into a loss expense for GAAP and tax purposes. There is no way to remove a correctly reported credit event from your credit report.

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Answered on 7/18/16, 12:23 pm


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