Legal Question in Real Estate Law in California
I sold a property in CA. The sale paid off both first and second mortgage. I purchased a home in UT. The second mortgage company kept my account open and said they would transfer the equity account to the new home, as I had the same equity. They never sent the new paperwork. They had told me it was ok to start using the money. It has now been three years and I am in default on the 2nd. Can they hold me accountable since they never did any of the new paperwork for the loan?
The original Trust deed had a full Reconveyance recorded for it.
2 Answers from Attorneys
It sounds like they gave you the money for the new second mortgage but never had you sign anything to record? If they never recorded the mortgage, they can not foreclose. It is not clear from the facts in your question exactly what happened. Please contact me to discuss further.
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The second mortgage company "said" -- does this mean they didn't put any of this in writing? Sounds like this will be a difficult matter to sort out. Did you get a reconveyance of the second as well as the first? A reconveyance would take them out of the picture, and any remaining or new debt would have to be based on a new note and deed of trust.
If the property supposedly securing the loan is in Utah, possibly you will need to consult a Utah lawyer.
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