Legal Question in Real Estate Law in California
Had a first and second purchase loan with wells Fargo. Property was foreclosed upon, but wells continue to post open account with a high balance. This affects mycredit adversely. What can I do. When I contact wells , they try to tell me that the second is a line of credit but it was actually purchase money. Couldn't obtain home with out second motrgage
2 Answers from Attorneys
They are accurately reporting an unpaid account. The fact that there is a legal prohibition from them taking court action to collect it, does not mean it is not an open and unpaid debt. Other prospective lenders have every right to know that you have this unpaid debt.
The fact that the loan was purchase money, or held by the same lender at the time of foreclosure only protects you from a lawsuit for any deficiency. It does not prohibit their accurate reporting of the fact that you defaulted and went into foreclosure.
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