Central District Consumer Bankruptcy Attorney's Association

Ive been called worse.
If you have any questions or concerns, please contact me.
Pat
Patrick T. Green
Attorney at Law
Fitzgerald & Green
1010 E. Union St. Ste. 206
Pasadena, CA 91106
Tel: 626-449-8433
Fax: 626-449-0565
pat@fitzgreenlaw.com

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Oops, meant to write Pat. My apology.

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Thanks for the advice, Dennis. Have attended the NACA conferences already but I should probably get my hands on the NCLC manual.

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Thanks for the tips, Nick and Jay. Never brought an FCRA or FDCPA claim before, I guess Ill need to do some further research. If anyone has any case law, case numbers, pleadings or other resources on the topic, please email me.
Thanks,
Stephen

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Nick:
My reading of the case excerpts you provided only indicate under 580d that a sold out junior is not prohibited from pursuing a deficiency. However, 580b prohibits a purchase money lender from pursuing a deficiency. If the sold out junior is purchase money, as is the case of the typical 80/20 loan where the purchase is 100% financed, but there are two loans, the 580b blocks a deficiency jmt. The prohibition of 580b stands alone and is not trumped by the cases you cite which do not address the issue. The prohibition originates with loan and mortgage and continues to exist whether there is a default or not.
The CEB Treatise CA Mortgages, Deeds of Trust, and Foreclosure Litigation puts it his way: CCP 580b operates within a different frame of reference than do CCP 580a, 580d and 726, which relate to the process of collection after default and do not apply to predefault events. 580b is independent of the postdefault collection process. Its application depends on the original nature of the secured transaction, i.e., whether the loan was initially made for the purpose of purchasing real property security (citations omitted).
If you have any questions or concerns, please contact me.
Pat
Patrick T. Green
Attorney at Law
Fitzgerald & Green
1010 E. Union St. Ste. 206
Pasadena, CA 91106
Tel: 626-449-8433
Fax: 626-449-0565
pat@fitzgreenlaw.com

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Assuming the junior was barred from bringing a deficiency suit against the homeowner, we have an error in the reporting of the debt. The consumer needs to dispute the trade line with the credit reporting agencies. In the event that the creditor verifies the debt as due and owing, you've got a nice FCRA lawsuit. If you can verify that the score drop was a direct result of this trade line being improperly reported then you've got a lovely FCRA action and potentially nice recovery.
Jay S. Fleischman, Esq.
Shaev & Fleischman, LLP
Smart Solutions To Bill Problems
T: 626-808-4343 x704
E: jay@sflawca.com
www.ConsumerHelpCentral.com
556 S Fair Oaks Ave Ste 101-152
Pasadena CA 91105-2656
Email isn't secure, so it's not confidential. By communicating with me by email, you understand that it's not confidential.

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In this instance, Im fairly confident that 580(b) applies and a deficiency judgment is prohibited. Nick, 580(b) says that deficiency judgments are prohibited after the foreclosure sale of real property that secures a purchase money loan. 580(b) operates within a different frame of reference than does 580(d). Its application depends on the original nature of the secured transaction i.e. whether the loan was initially made for the purpose of purchasing the real property security.
The sold out junior creditor is barred from bringing a personal action against the homeowner when the junior lien secures a purchase money loan. See Brown v. Jenson (1953) 41 C2d 193.
The Roseleaf case that you cite below is distinguishable because the seller took notes on other properties already owned by the buyer which meant it didnt qualify as a purchase money loan.
Assuming we have a sold-out junior barred from bringing a deficiency suit against homeowner, any thoughts on the original question regarding the reporting of this on his credit report as being an open account with a balance?
Thanks,
Stephen

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Thanks for your response, Nick. Well my understanding is that 580(b)
protects a homeowner from a purchase-money second (hence non-recourse)
irrespective of the anti-deficiency statute in 580(d). I dont believe
580(b) qualifies its protections based on the foreclosing entity.

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A family friend lost his primary home to foreclosure in 2010. There was a
1st and 2nd both purchase money loans. The 2nd still shows up on his credit
report as being open and with a balance due.
I'm familiar with CCP 580 (b) and (d), just want to confirm that from a
credit reporting perspective the lender should not be reporting this as an
open account with a balance due. Assuming this is reported incorrectly,
what's the best course of action? His credit score has dropped an additional
100 points since the foreclosure due to this open account.
Thanks,
Stephen
Stephen Vokshori
Vokshori Law Group
1010 Wilshire Blvd. Ste. 1404
Los Angeles, CA 90017
main: (213) 986-4323
fax: (310) 881-6996
email: stephen@voklaw.com
web: www.VokLaw.com
A family friend lost his primary home to foreclosure in 2010. There was a 1st and 2nd both purchase money loans. The 2nd still shows up on his credit report as being open and with a balance due. I’m familiar with CCP 580 (b) and (d), just want to confirm that from a credit reporting perspective the lender should not be reporting this as an open account with a balance due. Assuming this is reported incorrectly, what’s the best course of action? His credit score has dropped an additional 100 points since the foreclosure due to this open account. Thanks,Stephen Stephen VokshoriVokshori Law Group 1010 Wilshire Blvd. Ste. 1404Los Angeles, CA 90017 main: (213) 986-4323fax: (310) 881-6996email: stephen@voklaw.comweb:
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