Legal Question in Real Estate Law in California

Hi. I settled my fathers HECM with the servicer. While in the process, there was a NOD filed. This was after my notification as an heir to settle the debt which HUD says there should be no foreclosure action for 180 days after such notice. Regardless, the loan was settled per HUD guidelines and I have copied from my county records (OC, CA) the Reconveyance for the FIRST DoT benefitting the servicer. I have not seen a Reconveyance for the SECOND DoT benefitting Secretary of HUD. I understand a SECOND DOT of this type is always filed with a HECM.

My question is this... Does the Reconveyance on the FIRST DoT automatically CANCEL or RESCIND the NOD or does an explicit rescission need to be filed? The NOD references the county record document for the FIRST DoT.

Second, would I demand the Reconveyance for the SECOND DOT from the servicer as well or should this be made to HUD directly?


Asked on 4/23/13, 12:36 pm

1 Answer from Attorneys
Anthony Roach Law Office of Anthony A. Roach

For members of the public who read these in the archives, HECM stands for Home Equity Conversion Mortgage. It is the only type of reverse mortgage that is insured by the federal government, and is given through an FHA approved lender.

The reconveyance of the first deed of trust cleared the lien of the first deed of trust. The Notice of Default at that point is useless. Some title companies however, may want to see a recorded "cancellation of Notice of Default." State law now requires this when an alternative to foreclosure has been pursued by the owner and the lender.

I've never heard of a second on a reverse mortgage. If the obligation secured by the second has been paid, however, then you have the right to request reconveyance of the second deed of trust.

Read more
Answered on 5/17/13, 10:59 am


Related Questions & Answers

More Real Estate and Real Property questions and answers in California