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What You Need to Know Craig Triance, JD THE LIFEBOAT GROUP, INC.
Executive Summary
For purchase money mortgages; nothing to worry about. y For refinance and HELOC mortgages, a one-way ticket to a Latin American country without an extradition treaty works wonders.
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California Law
Anti-deficiency Statute: CCP 580a-f y Prohibits Deficiency Judgments for purchase money mortgages if using nonjudicial foreclosure CCP 580b
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A purchase money loan is one where the money went from the lender, to escrow, and then to the seller or to pay purchase closing costs.
What is a Deficiency?
It is an unsecured transaction, like a credit card. y It is not a priority y or a secured debt y For bankruptcy or y Collections reasons
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More Hints
If the lender is the same bank for the first and the second, and they were issued at the same time, the loans have merged and there is no deficiency. y Simon vs. Superior Court 4 Cal.App.4th 63 (1992)
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Evil Vampire Squid wont waive deficiency on purchase money second, Palm should protect you.
Borrowers execution of the Short Sale Approval letter dated ______ between (name of evil servicing company) and Borrower does not constitute a waiver of Borrowers rights under the antideficiency statutes of the State of California, for purchase money mortgages as provided by Code of Civil Procedure Section 580 et.seq.
Recommendations to Client
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If the second is a purchase money second and the bank comes after them for a deficiency fight the law is on your side.