Legal Question in Real Estate Law in California

This is really a situation where you need to consult with an attorney and discuss the full facts of the matter. That being said, you need to understand that whether or not your "friends" have ever paid a penny into the house, if they were cosigners, then they are on title to the home. I hear quite frequently this story, and that the "friends" were never supposed to own any part of the home. The problem is that when the escrow closed, and your "friends" were on title, they have a legal ownership interest in the property. They are not required, absent a written agreement between your husband and his "friends" to release their legal ownership interest. Depending upon how title was vested, they are probably "co-tenants" with your husband. While your husband could sue them to partition the property, the cost of doing so may well outweigh the benefit. Again, without looking at the specific facts, it is impossible to say if walking away is the best decision. There are a lot of factors to look at, including whether there is a possible deficiency post-foreclosure, if you have any income tax events as a result of a foreclosure, what the impact on your credit might be . . . you need to consult with a local attorney.

*Due to the limitations of the LawGuru Forums, The Gibbs Law Firm, APC's (the "Firm") participation in responding to questions posted herein does not constitute legal advice, nor legal representation of the person or entity posting a question. No Attorney/Client relationship is or shall be construed to be created hereby. The information provided is general and requires that the poster obtain specific legal advice from an attorney. The poster shall not rely upon the information provided herein as legal advice nor as the basis for making any decisions of legal consequence. As required by 11 U.S.C. �528, we must now disclose that, "We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code. Assistance we provide with respect to Debt Relief may involve bankruptcy relief under the Bankruptcy Code."

Gibbs is just wrong about the ownership issue. If your "friends" went on title as an accommodation and everyone agreed that they would not take any true ownership in the property, they took a resulting trust. As trustees they have breached their fiduciary duty to reconvey the property. It may not be as simple as all that, and Gibbs may be right that the equity in the house may not be enough to make it worth it, but he is definitely right that you need to sit down with an attorney and go over all the details, rather than give a few facts on a web board and expect a useful answer.