Legal Question in Family Law in California
Foreclosure in divorce
My sister has a house with both husband and wife names on the title, but the loan bears only her name because her husband has a very bad credit. This is the first mortgage loan for primary residence, not refinancing. She is filling for a divorce. The husband moved out for 10 months already without giving any financial help on child support and mortgage payment. After 10 months, she is exhausted financially. She wants to let the house go into foreclosure. The current house price is under water, no equity. She owns a private business (not Corporation LCC), and she is afraid that after the bank repossesses the house, they will sue her business to recoup the lost loan. The business is crucial to support the kids. Can the bank do that? Or any law protects her from the bank to sue her business because the mortgage loan goes under?
2 Answers from Attorneys
Re: Foreclosure in divorce
Please tell her to contact me directly. I highly doubt that bank will sue her.
Re: Foreclosure in divorce
The general rule is that the lender cannot sue for a deficiency judgment on a the financing for the purchase of your residence.
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