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Foreclosures and Second Mortgages

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brettej

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What is the name of your state? California

Six years ago, I foreclosed on a mortgage in Southern California. At the time, I had a first mortgage and a second mortgage. The second mortgage was NOT a purchase money mortgage; it was a cash-out mortgage for 110%, made after the home was in our possession. At the time of foreclosure, the second mortgage company made no effort to collect on the deficiency balance. Nor did the second mortgage company ever report a deficiency balance on our credit report. I believe that the second mortgage was sold in the secondary market to a new lender. I have not heard from the second mortgage company since the foreclosure. I recently received a collections call from a mortgage company I do not recognize. I have not returned the call. Can that lender now, after six years, come to collect on the deficiency balance? If so, can they put a lien on a new home that I have purchased?
 


HomeGuru

Senior Member
brettej said:
What is the name of your state? California

Six years ago, I foreclosed on a mortgage in Southern California. At the time, I had a first mortgage and a second mortgage. The second mortgage was NOT a purchase money mortgage; it was a cash-out mortgage for 110%, made after the home was in our possession. At the time of foreclosure, the second mortgage company made no effort to collect on the deficiency balance. Nor did the second mortgage company ever report a deficiency balance on our credit report. I believe that the second mortgage was sold in the secondary market to a new lender. I have not heard from the second mortgage company since the foreclosure. I recently received a collections call from a mortgage company I do not recognize. I have not returned the call. Can that lender now, after six years, come to collect on the deficiency balance? If so, can they put a lien on a new home that I have purchased?

**A: yes and yes. It appears that in your case, the first mortgage lender filed foreclosure and the second mortgage lender just went along and got a deficiency judgement. Find out the real facts and report back.
 

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