Legal Question in Real Estate Law in California

Re: 2nd private party loan on a second grant deed

Well, I can see a few issues here that might get the guy off your back.

First, if the interest rate was really 20%, that is usurious unless the lender us exempt from the usury laws....is he a licensed broker? You would be entitled to treble damages for any usurious interest paid. However, $200 a month is $2,400 a year and that's only 8% the way I figure it.

Second, and more important, a mortgage is still a mortgage, even if is desguised as a grant deed, absolute on its face. You were probably entitled to all the formalities of a foreclosure proceeding in court - since this loan evidently did not include a power of sale (by trustee), it would have to be foreclosed in court.

There were probably other shortcuts, oversights and frauds in this deal as well; both lending and foreclosing being highly regulated activities with numerous protections for homeowners and borrowers.

I'd say this guy has probably broken enough laws and has exposed himself to enough potential litigation costs and liability for damages that he ought to give you back your house and call it "even" for the motorhome.

I would sue to set aside the deed and have title quieted in you. I would also ask the court for a restraining order against any attempt to evict you, and if the numbers support a usury claim, I'd ask for treble damages for the interest paid. I'd look for any traces of fraud in the loan deal, whether he had the proper licenses, etc.

Meanwhile, how are you doing on keeping up with your 1st, and would you have enough income to keep the house if this problem went away? Please feel free to contact me with details. I would love to take this case but looks like you are too far away.