Legal Question in Real Estate Law in California

I had a foreclosed property that had a second mortgage. It was a 80/20 loan (20% purchase money loan).Both loans are from the same bank. This was not our primary home. The bank is now offering to settle the 2nd for $10,000.00 ($93,000 was the amt of the 2nd loan) and giving us 4 weeks to pay or they will accelerate. What would be the best thing to do.Am I protected under Code of civil Procedure section 580d and 580b? Property was sold under a Trustee Sale


Asked on 4/01/11, 10:15 pm

2 Answers from Attorneys
Anthony Roach Law Office of Anthony A. Roach

You are protected under section 580d. The second can normally sue after the first forecloses as a sold out junior lienholder. The sold out junior lienholder exception, however, does not apply if the same lender held both the first and senior liens. (Simon v. Superior Court (1992) 4 Cal.App.4th 63, 76-77.)

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Answered on 4/02/11, 8:27 am
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

I agree. 580b isn't helpful because the property wasn't your primary residence, but 580d as interpreted in the Simon case protects you from a successful suit.

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Answered on 4/02/11, 10:53 am


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