My wife and I stopped paying our mortgage in California and moved to Oregon two years ago. We have no clue if that house was ever in foreclosure. We just received two letters from a collection company trying to collect on our mortgage loan, which is our first mortgage for that house. The first letter was titled "Debt Validation Notice". The second letter was titled "Notice of Default and Election to Sell Under Deed of trust". What does this second letter mean? How can we find out if that property is in foreclosure?
Real Estate Attorney
The second letter is a notice that the house will be placed for sale by the trustee at a date and time set forth in the notice. If you do not act to prevent or delay the sale, pending renegotiation or modification of the loan, the house will be sold.
You should be especially careful, as California law may require you to pay any deficiency in the sale price. That is, if you owe 500k on the loan and they sell it for 400k then you are resposiblie for the 100k deficiency. Oregon is a "mortgage" state and does not typically provide for deficiency judgments. Because the property is in California , the law of that state applies and this could be an issue for you.
This posting does not create an attorney client relationship ,and is for informational purposes only. Any formal representation and advice will require establishment of a contractual relationship with an attorney. For more information go to www.meadfirm.com
Personal Injury Lawyer
Your question appears under the "Oregon" questions for Avvo. It would be better to post your question with a California location so the question is posted with the California questions.
A Notice of Default and Election to Sell means that the property is in foreclosure and will be sold at auction. It is generally recorded in the deeds office, in addition to being delivered to you, and serves as public notice that the property is in foreclosure. At this stage, the foreclosure is not a done deal, and you may have defenses and/or options for avoiding the auction of your property. You should contact an foreclosure defense attorney licensed in California immediately to discuss your rights under California law.
Contracts / Agreements Lawyer
To add to the other answers, you are very unlikely to face a deficiency judgment in California since the vast majority of residential foreclosures there and elsewhere in the western U.S. are conducted non-judicially, and to get a deficiency judgment lenders have to go to court (i.e., judicial foreclosure). Nonetheless, you definitely will want to consult with an attorney as to your rights, obligations, and potential consequences in this situation.
DISCLAIMER: I am not your attorney until you 1) sign a fee agreement with me, and 2) pay a retainer pursuant to said agreement. The response given does not create an ongoing duty to respond to questions. The response does not form an attorney-client relationship. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might change. Attorney is licensed to practice law only in Oregon (attorney has resigned from the Arizona bar, but may be reinstated upon application).
Real Estate Attorney
This is clearly a California law issue. I would guess that you are not in danger of incurring liability for a deficiency, but you should verify this with a California lawyer.
This comment is general in nature and is not intended as legal advice. It does not create an attorney client relationship and obviously is not confidential. You should contact an attorney in your area who can review with you all of the relevant facts and give you specific legal advice.