Currently, certain lenders and debt collectors contact borrowers after foreclosure in an attempt to collect on deficiencies claimed to be due and owing. The new law, Senate Bill 426, will generally prohibit a lender from claiming that a deficiency is owed, such as on a credit report, or from collecting a deficiency. The new law applies to loans foreclosed upon by a trustee’s sale, as well as loans secured by purchase-money, owner-occupied, one-to-four residential unit properties (including refinances with no cash out). A lender, however, can pursue a deficiency against a guarantor or other surety (such as a mortgage insurer), or pursue other security for a cross-collateralized loan.
Posted on: Tue, 06 Aug 2013 22:01:13 +0000
Trending Topics
Recently Viewed Topics
© 2015