Archive for the ‘California Lawyers’ Category

Info On California’s Anti-Deficiency Legal Guidelines

Wednesday, October 5th, 2011

Hello, that is Derik Lewis with Lawyers Realty Group and we’re :k1:’s main short sale team. I often here that California is a non-deficiency state, and that’s not really true. Lenders in California have the right to hunt deficiency judgments and sure lenders are allowed to sue for unpaid balances for a interval of 4 years after default. What we do have in California are the anti-deficiency laws. They bar lenders from seeking deficiencies. They really begin with CCP 726 it is the inspiration of the anti-deficiency laws. 726 says [that a] lender would need to go after a property earlier than the lender might sue you on the note.

The most protective legislation that stops lenders from going after borrowers is CCP 580 B, and that is referred to as the purchase cash protection. You probably have a mortgage or loans, that were used to finance the purchase of the property, that lender is barred from seeking any kind of deficiency or suing you whether or not it is after a short sale or foreclosure, or otherwise. In the event you’ve refinanced any of that, it’ll lose the acquisition money safety and you will be subjected to potentially a lawsuit or a deficiency judgment.

The following greatest protection is if you happen to had one loan and also you refinanced that one mortgage, if that lender forecloses non-judicially then CCP 580 D bars them from looking for a deficiency against you. The issue with that situation is that if you happen to had loans, a primary and a second, they usually had been both refinanced, if the first had been to foreclose, they’d be barred below 580 D, but they might wipe out the lien of the second mortgage. That doesn’t mean the debt is wiped out. In that state of affairs, that second mortgage is allowed to return after you and sue for as much as four years after the default to seek breach of contract. That is a situation the place we extremely suggest searching for out the potential for a short sale. You’ll be able to negotiate with that second lien holder to take something now. We’d try to get a waiver of deficiencies in that short sale. These are essentially the most protective of the anti-deficiency legal guidelines in California.

We also have a new legislation in California, the 580 E. Mainly that says in a short sale, the first lien holder will not be allowed to reserve the fitting to sue you publish short sale. It’s a slim protection, but we’re glad to have it.

There’s extra information on the webinar on our website. We also have some weblog posts, and you may look at these to get some answers. You can also send me direct questions by the website. I reply those personally and I all the time stay up for seeing these and serving to you out if I can. Go to our website, lawyersrealtygroup.com, where we are :k1:’s main short sale team. Bear in mind, your lender has a lawyer, and it’s best to too.

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