Legal Question in Real Estate Law in California

Re: Lien against house co-own

If you are late on paying a credit card, the credit card company cannot immediately put a lien on your house. They first have to sue you, then obtain a judgment, and then record an abstract of the judgment with the county recorder where you have real estate. The abstract of judgment will become a judgment lien on all real estate you own in that county.

Have you received anything in writing from the credit card company saying they will lien your house? If so, can you email or fax it to me? I would like to review it. No charge.

Re: Lien against house co-own

In general, delinquency on credit cards does not lead directly to a foreclosure on real property.

There are two exceptions to be aware of and to understand.

The first is that a credit card might be tied to a home equity line of credit. If this were the case, you would know about it, since you would have been asked to sign a note and deed of trust to collateralize the card with your home equity.

The second way a credit card delinquency could lead to a foreclosure is a three-step process: first, the card company would sue you and get a court judgment for the amount owed. Then, they would record an abstract of judgment, resulting in a judgment lien on your property. If unpaid, the card company could then initiate proceedings to foreclose the judgment lien, or alternatively, it could wait for the house to be sold and go into escrow and be paid from the proceeds of that sale.

If the debts are yours alone, the lender can only lien and foreclose your interest in the house under either scenario; it cannot touch the other owner's interest, but your mother could end up with strangers as co-owners.

Re: Lien against house co-own

The credit card companies must first get a judgment, which will not be too hard to do as you owe them the money. A judgment lien may then be recorded against all property in your name.

Once a judgment lien is recorded, the creditor may obtain a writ of sale and sell your property at a foreclosure sale. Depending on how title is held, the creditor may need to file a second lawsuit against your mom to force her to sell her interest in the property. Either way, the creditor may be able to force your mom out of the property.

You may qualify for an exemption, or you may be able to discharge the debt in bankruptcy. A lawyer would need more information in order to advise how to avoid the foreclosure of your home.

Re: Lien against house co-own

Credit card debt only becomes a lien on assets if the debt is reduced to judgment. Once it is reduced to judgment it becomes a lien and a lien can be foreclosed. But, a credit card company will not want to foreclose agaisnt a house because it will then have to continue paying the mortgage itself.