Legal Question in Real Estate Law in California

Re: foreclosure with equity

The answer is yes and no. Yes, technically if the property sells at auction for more than what the lender is claiming in principal balance, late fees, accrued interest, foreclosure costs, etc..., then you would be entitled to that difference, assuming that there is no second loan, or third or other encumbrance that the lender must pay after the sale before sending you the net proceeds. This would only happen if at the foreclosure sale, someone other than the lender ends up buying the property.

No, the most likely outcome is that the lender will have a windfall - they will "credit-bid" the property at sale for what they are owed, and if nobody else bids, they get it for what they are owed, and can re-sell it and keep the profit. Welcome to the wonderful world of foreclosure.

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Re: foreclosure with equity

On foreclosure, a home will be sold at auction for whatever it will bring. Any money recovered goes first to pay foreclosure costs, then any taxes due, then 1st TD, then 2nd TD, etc., then any other junior liens and personal judgments, and finally IF, IF, any money is left over after all lien holders and costs have been paid, the homeowner will get the balance. Don't count on getting anything. If its market value really is twice your loan, you would have been able to sell it and avoid foreclosure. Plus, if this was anything other than a legitimate original 'purchase money' loan, you can probably be sued by the lender[s] for any deficiency after sale. If you need legal help and counsel in this process, to attempt a different outcome, feel free to contact me.