Legal Question in Real Estate Law in California

Foreclosure and refinance

I refinanced my second into my first two years ago with the same lender who held the original first. Now in foreclosure, can they hold me liable for the deficiency because of the refinance ?


Asked on 4/18/08, 10:24 pm

3 Answers from Attorneys
Mitchell Roth MW Roth, Professional Law Corporation

Re: Foreclosure and refinance

Yes, but only if they pursue a judicial foreclosure. If they pursue a non-judicial foreclosure (the typical case) they will waive any right to a deficiency judgment.

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Answered on 4/20/08, 2:38 pm
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Foreclosure and refinance

If it is a non-judicial foreclosure, no, they cannot hold you liable for a deficiency. A non-judicial foreclosure is one that is done by trustee sale rather than by taking you to court.

Even if the sue you so that the foreclosure becomes judicial, there is a possibility that you may have a defense if the refinanced second was a purchase-money loan rather than a later-on "cash out" loan.

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Answered on 4/20/08, 8:42 pm
Michael Stone Law Offices of Michael B. Stone Toll Free 1-855-USE-MIKE

Re: Foreclosure and refinance

Please consult a bankruptcy lawyer at once and in person to find out if a Chapter 13 filing can help you save your home, and for amswers to your other questions. A bankruptcy filing will halt the foreclosure, at least for the time being..

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Answered on 4/18/08, 10:55 pm


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