Legal Question in Real Estate Law in California

Re: Forged loan documents

Some favor, huh? This happened a lot in the days of easy credit, and unfortunately, if he couldn't get a loan in 2005 because of his credit and/or income situation, then there is no chance in you-know-what that he can get it refinanced today. As for the "forged" signatures, how did he get around the Notary who acknowledged the Deed of Trust? Because you were a willing participant in all of this (you accepted $10,000 to do the deal, and have a signed acknowledgment that he was going to do this), I don't believe you have grounds for rescission of the loan. That being said, a potential argument MIGHT be made that, if you did not sign the three day right of rescission notices, you still have the right to rescind the deal. The problem is, in a rescission, you don't get to keep the house free and clear of the bank's lien without paying the bank back the money they advanced on that asset.

You have few options. You need to review the document you and your "friend" signed and see if it might allow you to simply evict him and take over the house - then being in a position to sell it. Alternatively, if you transferred the home into his name by a deed, and you are still liable on the loan, you are really in a tight spot, and need some specific legal advice. Good luck - this is much more common than you might think, not that it helps ease the pain any.

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