Legal Question in Real Estate Law in California

You don't. Just because they are barred from collecting doesn't mean you aren't defaulting on the debt. Credit reports your payments owed and paid or not paid as agreed. You are in breach of your agreement from a credit standpoint, regardless of whether they have a legal remedy for that or not.

When a first is foreclosed, that doesn't make the second go away. The second becomes an unsecured obligation of the borrower, still due, payable and totally in effect. Mr. McCormick is right. You still owe the balance on the second. It is, however, no longer secured by the real property.

First of all, when you state that you foreclosed on a home, I assume that you mean you were the lender who did the foreclosing. It was not until I read the rest of your post that I realized that you were foreclosed on.

If the second was a purchase money mortgage, it was subject to Code of Civil Procedure section 580b, and the lender could not collect on it. The lender, however, is entitled to report it to any or all of the three (3) credit reporting bureaus. It can be carried as a negative report on your credit for seven (7) years.