Legal Question in Real Estate Law in California

Re: collection on a second for sold property

If the second was a purchase-money loan secured by your home, the lender or a bill collector that bought the note for pennies on the dollar will be barred by the antideficiency laws from recovering from you. A statute of limitations defense is also available (see below).

If the second was other than a purchase-money loan, e.g., it was a refinancing, a cash-out, or a home improvement, etc. loan, you would have been liable to the note holder until the statute of limitations for suit on the debt ran out. The applicable statute provides a four-year post-default period for suit (Code of Civil Procedure section 337, Hillen v. Soule (1935) 7 Cal.App.2d 45 and page 47.

Since whoever is dunning you undoubtedly knows this is an uncollectible bill, the practice may fall under one or another of the unfair debt-collection procedures laws as Mr. Stone suggests. You might start with the federal Fair Debt Collection Practices Act (FDCPA) 15 U.S.C. 1692 to 1692p, on line at www.ftc.gov/bcp/edu/pubs/consumer/credit/cre27.pdf.

Re: collection on a second for sold property

If they have a court judgment against you, it is enforceable forever as long they keep it renewed. "Lifting the lien" does not necessarily mean they waived their rights and claims on you. If they are simply trying to collect without a judgment, tell them to go pound sand.

Re: collection on a second for sold property

If some collection agency is trying to dun you for a bill that is 14 years old, this could be an unfair debt collection practice, and you could be entitled to sue them and collect damagaes.