Legal Question in Real Estate Law in California
I bought my home in Los Angeles in 2006. Going through Short Sale process right now.
I did refinance of the HELOC in 2008. I didnt get any Cash out but, actually gave cash to reduce the loan period from 15 to 5 years.
Now after Short Sale can the Bank come after me for the deficiency amount?
2 Answers from Attorneys
Your question shows that you know something about the applicable law. Unfortunately, you didn't give us enough information to answer the question cleanly, without inserting a bunch of "ifs" into the response.
I'm missing the "ifs" Mr. Whipple refers to. The HELOC is not a purchase money loan, and a short sale does not cut off deficiency rights the way a non-judicial foreclosure would. So unless the bank agrees to forgive the balance as part of the short sale agreement, yes, they could come after you for the difference between what they get in the short sale and what is owed.
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