Legal Question in Real Estate Law in California

Re: Collection of 2nd Trust Deed debt (after foreclosure)

I am not a bankruptcy expert, but here's what may have happened. You don't say who foreclosed, but if it was the holder of the first, they got the only satisfaction they were entitled to through the trustee's sale. That may have wiped out the credit untion's second D/T if there wasn't enough sale proceeds to pay them off. So, at that point the credit union was left with an UNSECURED note, which you should have listed as a debt NOT secured by real property.

If I'm right, the debt was not discharged by the bankruptcy because it wasn't listed, or wasn't listed in the right schedule....but I could be wrong.

This is the problem with "in pro. per." actions, especially in bankruptcy.

But, again, I'm not a specialist in bankruptcy, but if the credit untion is pursuing you this could explain why.

Re: Collection of 2nd Trust Deed debt (after foreclosure)

Assuming that your bankruptcy was a no asset case, you can petition the court to re-open your case to add an omitted creditor. You should consider hiring an attorney to represent you in doing this.

Re: Collection of 2nd Trust Deed debt (after foreclosure)

The debt to a second trust deed holder is not wiped out through a foreclosure by the first lender, unless they are the same company. The credit union should have been added as a creditor in the BK.

Re: Collection of 2nd Trust Deed debt (after foreclosure)

Due to antideficency legislation and the bankruptcy, you may not be liable. The paperwork would have to be reviewed in order to determine your liablity. Please call Mary at 714 363-0220 to set up an appointment.