Legal Question in Real Estate Law in California

Re: real estate forclosure

I am truly sorry to hear about your problems. I guess there is some comfort in the fact that Californian's are suffering the exact situation you describe to one degree or another at virtually all levels. People are being faced with extremely hard decisions every day, and sadly, there aren't a lot of great options.

As to your question, there are a few more facts that an attorney will need to advise you properly about the potential outcome of a foreclosure. If you have one loan on your property, its very likely that you will not have further liability to your lender if you walk away. If the lender elects to foreclose on your home "non-judicially," then they are barred (except in extreme cases) from seeking any further monetary damages from you. Its called the "one action rule" or "election of remedies rule." If you have more than one loan on the property, you should consult with a local attorney as there could be some liability for the balance on that loan if you walk away.

Additionally, you need to examine if you will have any liability for HOA dues, property taxes and other expenses associated with the home after you walk away. Again, these are generally fact-specific, and will require a review by an attorney. An hour or two of an attorney's time is almost certainly worth the cost just to have some peace of mind, and to be fully informed before making a decision as to what to do. One thing I tell people is do not let emotion rule your decision. Ultimately, the house is just wood, cement, plaster, etc... if the best decision financially is to walk away, then do so - don't kill yourself staying in a home you cannot afford out of emotional attachment. Conversely, you do owe it to yourself to consult with a legitimate, experienced attorney to see if you have other options such as loan modification, bankruptcy, etc . . .

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