Legal Question in Real Estate Law in California
I carrying a loan on a mobile home, which is now in default. What is the next s
My grandmother owned a mobile home and sold it to a woman for $15,000. She carried the loan for the whole amount. The sale was done December 23, 1994. My grandmother passed away and deeded me the rights of the oustanding balance. Although my grandmother did not know it according to the loan agreement if the buyer was late on a payment the loan could be due at that point for the balance and any payment after that was interest only. The buyer made late payments starting as early as March of 95! Also they have not made a payment since July of 2000! What should I do? If I take back the property I could maybe sell it for $25-$35K when fixing it up. What is the first step and how should I proceed. I have had many different ideas such as offering the buyer $1,500 to give back the property and leave, or just evicting them.
Thank you for your wisdom.
3 Answers from Attorneys
Re: I carrying a loan on a mobile home, which is now in default. What is the ne
Bryan nailed it. If the mobile home is personal property. Then you can go to DMV and have your grandmother's lien holder's interest transferred into your name. Take a certified true copy of your grandmother's death certificate with you. Giving the occupant some money to move is a good idea. However, by now they are so comfortable living in the mobile. That they may not accept. However, being reasonable is always a good place to start.
Re: I carrying a loan on a mobile home, which is now in default. What is the ne
I agree with both answers. It could save you a lot of time an trouble if they are willing to accept a few dollars to move (after all, they have lived for free for 1 and a half years. Try that route first.
If you need help, let me know. I am in Pleasanton.
Re: I carrying a loan on a mobile home, which is now in default. What is the ne
First step is to confirm that the mobile home is real property rather than personal property. This occurs when the wheels are removed and the unit is placed on a foundation and is covered by a building permit. If the unit is still personal property, the applicable law is different.
Second, you probably mean that the note was given to you by will, not that it was 'deeded' to you. This is not a major issue, but you should be clear about the source of your rights to payment or to foreclose. The buyer/occupant is likely to question your rights.
The note (and/or deed of trust) probably contain an acceleration clause, allowing the lender to declare the entire principal balance due upon a default. You seem to have a sufficient default to trigger your right to accelerate.
Whether you are better off going through a foreclosure or negotiating a buy-back is a matter of economic fact and I can't advise you from a distance. My hunch is that if you come up with a proposal that would please you if it were accepted, try it out on the buyer/borrower, then (if it is acceptable in principle) get it put in writing by a local real-estate attorney, you will be more satisfied with the overall result than if you had to go through with foreclosure.
On the other hand, if the buyer/borrower is not cooperative, you can foreclose. Eviction is not the concept at present, since the occupant is technically the owner. If he doesn't vacate after a foreclosure (or sale back to you), then you need to evict.
All in all, it's a matter of economics, and since the money numbers are relatively low (as real property goes) you are probably better off incurring as few fees and costs as possible, i.e. negotiate rather than bring formal proceedings if possible. In any event, have a lawyer draft any documents and make sure anything requiring recording or any notice required to be given is handled correctly.
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