Upcoming Foreclosures

Foreclosure with 80/20?

I bought a condo with an 80/20 loan where both loans are from the same lender. Both contracts say "purchase money" on them. I can no longer afford the payments and cannot refi because I am upside down on mortgage. If I cannot short sale and it forecloses, can the 80 loan foreclose as it's one action law in California and then the 20 loan sue me because of the one act law in California?

Public Comments

1. Did you try deed in lieu of foreclosure some banks here are doing that. Good luck, I know this is happening to a lot a people right now.
2. Foreclosures don't work any different in California than they do anywhere else....if you don't pay, they'll foreclose. The property is sold, the proceeds payoff the FIRST mortgage loan (doesn't matter if it's with two different lenders or not), and then if there is any money left over after foreclosure costs, they will apply it to the second mortgage and then levy a deficiency judgement against you for what it didn't pay...which means you'll most likely need to file for a BK right after that. My advice? If you KNOW there is no way to avoid it...do a Deed in Lieu..if you agree to leave the place sparkling clean, they will agree to forego the deficiency and not charge you foreclosure fees. You'll need to call the Loss litagation department with the lender to arrange it, you will both negotiate a date for you to leave, and they'll send you some papers to sign. Never let them forcefully take your home when you know you can't save it...all it does is cost you money.
3. In California, when a first mortgage forcloses, all junior mortgages are wiped out. The second mortgage lender is now an unsecured creditor and can try to get a judgement on your note. If they do they can use all legal means to collect the judgement.