Legal Question in Bankruptcy in California

In California, when a Home Equity Line of Credit is taken out at the same time by the same first mortgage lender, is the loan a recourse debt?

Also, when additional funds are taken out from the Line of Credit, does it become a recourse debt?


Asked on 8/03/09, 5:47 pm

1 Answer from Attorneys
Larry L. Doan Law Office of Larry L. Doan

If the HELOC was used at the same time as the first mortgage for purchase-money of owner-occupied property, that is the money was used to buy your home, which you originally moved into as your primary residence, then it's non-recourse. However, if it was taken out not to buy the house, then it's recourse. Additional funds taken out from the line of credit later are recourse.

Larry L. Doan

www.GuruImmigration.com

http://guruimmigration.wordpress.com (blog)

Note: The above response is provided for legal information only and should not be construed as legal advice, nor to create an attorney-client relationship, which can only be established through payment of consideration.

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Answered on 8/03/09, 10:46 pm


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