Legal Question in Real Estate Law in California

Forclosure Secondary Home in California
I refinance my home in 2005 with Option ARM and took money out toward my new home. I moved into my new home and used my old home as a secondary home/rental property. I have rented out my old home to students part of the year and used it as a secondary home for the other part of the year. Therefore, I did not receive the rental income every month.

Three years went by, I could only a pay a minimum payment to my old home which causing the principal balance increased by $ 35,000. I now realized that I couldn't afford to make payment any more.

What would happen to me if I stop making the payment to my secondary home/rental property? This property is worth half of what I owe. I don't have any money in the bank except for IRA account. I have a primary home but the house is also worth only half of what I owe. If this property will go into foreclosure, will the bank come after me for the difference? and How?

Thank you so much for your help !!

Asked on 7/17/08, 12:21 pm

Mitchell Roth MW Roth, Professional Law Corporation

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Re: Forclosure Secondary Home in California

If the bank forecloses by Trustee's sale, it waives any right for a deficiency judgment.

Answered on 7/19/08, 2:50 pm

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