Law Office of Melissa C. Marsh

Request a Same Day Telephone Consultation!

Contact Us
Sherman Oaks, CA
Tel: 818-849-5206
Tel: 323-655-1002
E-mail: mmarsh411@gmail.com

Search:
Your Legal Corner Home About Us Testimonials Blog Links Map & Directions Contact Us
Request a Same Day Telephone Consultation!    Visa Mastercard American Express PayPal A A A

Your Legal Corner - Client Alert Blog

 
 

New California Anti-Deficiency Protections For Refinanced Loans

Written By: Melissa C. Marsh, Esq., California Attorney, October 2012 Add to Favorites
California has enacted several anti-deficiency statutes to protect borrowers in real estate transactions. A “deficiency” is the liability of a borrower to the lender for the difference between the amount of the loan and the value of the real property. Existing California anti-deficiency laws protect a borrower on an original purchase-money loan (a loan acquired at the time the property was purchased and never refinanced) on an owner-occupied residential unit (up to four units) from being held personal liable to the lender for any deficiency that results from a short sale, or foreclosure. See, Civil Code of Procedures §580b and §580e. Under existing law, the anti-deficiency protection enjoyed by residential borrowers is strictly limited to the difference between the outstanding loan balance on an original purchase money loan and what the lender receives in a short sale, or foreclosure; existing anti-deficiency law does not afford any protections to residential homeowners who refinanced their original purchase money loan.

Effective January 1, 2013, a new California law will now protect borrowers on an owner-occupied residential property of not more than 4 units even if they refinance their original purchase money loan on or after January 1, 2013, so long as the homeowner does not "cash out" in the refinance. If the refinanced loan is purely a refinance of the original loan plus the cost of any attendant loan fees and related expenses, the borrower will now be afforded anti-deficiency protections. However, if the borrower pulls money out of the residential property to pay other bills, etc..), then the borrower would not qualify for California's anti-deficiency protections.

Unfortunately, the new anti-deficiency protections only apply to residential mortgage loans that are refinanced on or after January 1, 2013. As a result, homeowners who have refinanced their loans in the past will not be protected by the new legislation.


Tags: anti-deficiency, loan, refinanced loan
Posted In: Real Estate Reporter 

 
 
 
 

Blog Categories:

Business Law Bulletin
Corporate Client Bulletin
Employment Law News
IP Bulletin
Real Estate Reporter
Tax Update


Search YLC Blog:


Follow Us:

Follow Us on Facebook Follow Us on Twitter Follow Us on LinkedIn


Subscribe to Updates:

Interested in receiving this blog? You may add this blog to your feeds by clicking here or to subscribe by email


Recent Updates:


Archives:

January 2017
June 2016
May 2016
March 2016
December 2015
June 2014
April 2014
February 2014
November 2013
October 2013
September 2013
November 2012
October 2012
July 2012
May 2012
April 2012
March 2012
January 2012
November 2011
July 2011
February 2011
November 2010
October 2010
September 2010
April 2010
February 2010
January 2010
November 2009
June 2009
May 2009
March 2009
February 2009
January 2009
October 2008
June 2008
December 2005
 
 

If you would like to inquire about my services, please call 818-849-5206.
If you have additional questions or need specific legal advice tailored to your specific needs, please schedule a low cost Telephone Consultation.


Disclaimer: The information presented on this web site was prepared by Melissa C. Marsh for general informational purposes only and does not constitute legal advice. The information provided in my articles and alerts should not be relied upon, or used as a substitute for professional legal advice from an attorney you retain to advise or represent you. Your use of this Internet site does not create an attorney- client relationship. Transmission of this article is not intended to create, and receipt of it does not constitute, an attorney-client relationship. All uses of the contents of this site, other than personal uses, are prohibited. You may print or email a copy of any information posted on this web site for your own personal, non-commercial, use, but you may not publish any of the articles or posts on this web site without the Express Written Permission of Melissa C. Marsh.


Home | Request a Consultation | Practice Areas | Articles | Client Alerts | Testimonials | Directions | Terms of Use | Privacy Policy | Contact Us | Site Map
Copyright© 1998 - 2017, Melissa C. Marsh. All Rights Reserved.
Website Design By DK Web Design

Located in Los Angeles, California, the Law Office of Melissa C. Marsh handles business law and corporation law matters as a lawyer for clients throughout Los Angeles including Burbank, Sherman Oaks, Studio City, Valley Village, North Hollywood, Woodland Hills, Hollywood, West LA as well as Riverside County, San Fernando, Ventura County, and Santa Clarita. Attorney Melissa C. Marsh has considerable experience handling business matters both nationally and internationally. We routinely assist our clients with incorporation, forming a California corporation, forming a California llc, partnership, annual minutes, shareholder meetings, director meetings, getting a taxpayer ID number (EIN), buying a business, selling a business, commercial lease review, employee disputes, independent contractors, construction, and personal matters such as preparing a will, living trust, power of attorney, health care directive, and more.