Legal Question in Real Estate Law in California

Re: 2nd Mortgage

The holder of the second would start foreclosure proceedings in the hope of buying your home for the $19,000 outstanding balance, since even in these bad times you probably have a lot of equity in it. Whether the lender with the first mortgage would consider it a breach is unknown, but it is most likely they do not want to pick up another foreclosure so they probably will not do anything.

You need to check as to whether the second deed lender is a licensed ea estate broker; if not, they are in violation of the usury laws limiting interest to 12% for a private party. They would have to forfeit back to you all interest you have paid.

Talk to some of the organizations that explain the new rules for homeowners to see if they cna help at all. there are companies that claim for $2-3,000 they will reduce your mortgage by 50%. Offers that seem too good to be true normally are not true, but some of the companies tha promise less might be legitimate; but insist on results before you pay them any cash.

See if you can get the first deed holder to help.

Good luck.