Legal Question in Real Estate Law in California

Re: Does a foreclosure pay off a Note from 2nd party?

In California if a lien holder uses a non-judicial method of foreclosure, which appears to be what happened, they can not go after you anymore for the lien. The debt has been satisifed by taking your home if it is only secured by the lien on your home.

I can not understand why the first did not foreclose at the same time so they would not have a new debtor imposed on them without their approval. It seems to me that there is something missing in the facts you have presented. You appeared to have walked away from the $20,000 equity you still had in your home.

Re: Does a foreclosure pay off a Note from 2nd party?

If I understand you correctly, the junior lienholder is the one who foreclosed, and the home is still in her name at this point? If I understand you correctly, then yes, she is barred by the "one action rule" from pursuing you for any further money on that note.

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