Legal Question in Real Estate Law in California
My wife forged my name on home refinance and equity loans. I did not benefit from these loans. She used the money to buy and maintain other properties on which she also forged my name. Are these loans still valid or are they canceled because the loan contracts were fraudulenty obtained? Who makes good on these fraudulent loans that the bank gave money for? A notary was also involved.
She hid this from me for 6 years because she collected all of our mail and I would hand her a check each month with the mortgage payment for a $480K loan, which was validly obtained with my signature. A re-fi loan of $600K and equity loans were forged.. Last year, 2010, she said that she could not pay the bills anymore. That is when I saw the $714K mortgage. Copies of the loan docs at the county clerks office had my forged signature. The house is foreclosed. I am retired and living on pensions and did not qualify for a loan modification.. I notified the bank's fraud dept and they are investigating. Today, I received a possible monthly mortgage modification, that I can handle, based on the $714K loans with my forged signatures. It looks like I have a choice of either persuing the fraudulent loan claims or accepting a new mortgage with affordable monthly payments. Which I chose depends on the answers to the following questions.
Question: Are the loans with my forged signatures valid and do I have to pay them?
Question: If I accept the new $714K mortgage, are the forged loans forgotten?
1 Answer from Attorneys
The forged loans are not void unless and until you prove to the bank that you never consented to, nor actually signed the loan documents. Until then, the bank will treat them as valid and continue all collection activities. Unfortunately, it is up to you to prove that you never signed the loan documents. That being said, even if you void the loans, you may still have a problem in that under California law, debts incurred while married are considered to be community debts. I am not sure if there is a fraud exception to this rule, but there may be a separate basis for the lenders to hold you liable for the loans outside of the forged loan documents. You'll need to consult a family law attorney on that later point.
If you modify the loan, and sign a modification agreement, then you have almost certainly extinguished any ability you have to disclaim the loans as being fraudulent. By signing the modification, you are agreeing to the new terms, and most of the modification agreements I have read include language which effectively "refreshes" the old loan obligations. The old loans are not forgotten, but you are effectively ratifying them by signing the modification. I hope this helps.
*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."
Related Questions & Answers
Looking for something else?
10,200 active attorneys ready to answer your legal questions today.
Featured Attorneys
Earn additional revenue and grow your business.
