As a private mortgage lender, what are my options when my client turns back the property and doesn’t pay the mortgage anymore?
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As a private mortgage lender, what are my options when my client turns back the property and doesn’t pay the mortgage anymore?
Under CA law, what recourse do I have as a private lender when “everyone” is foreclosing on their homes?
Asked on December 12, 2011 under Real Estate Law, California
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
If you hold the first trust deed on the property that you are writing about and the borrower has failed to keep current on the monthly debt amount your option is to try and work a modification of the loan, accomodate in a short sale or foreclose upon the property.
If the borrower has offered to provide you with a deed in lieu of foreclosure, before accepting it, you need to obtain a preliminary report on the parcel. If there are junior liens on it, you should consider foreclosing on the parcel to wipe them out to clear title to it as opposed to taking title subject to the liens. For further questions I suggest that you consult with a real estate attorney about the question you have written about.
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