HELOC sent to collections, part of the original purchase loan 100%
I have a short sale near approval on 1st. 2nd(HELOC) was sent to collections already.
Both loans are original purchase loans with the HELOC(2nd) going 100% to the purchase price.
1st is giving 3000 to the 2nd. What options does the seller have in the state of california since both were WF and both original purchase loans?...the collection company has not been easy to deal with and of course want the 1st approval in writing before proceeding.
Has anyone had any luck getting the HELOC released and verbiage removed on the approval letter ?
I do know that WF is revising the short sale approval letters to the state of california to address the unique situation of California being a non deficiency , single action state. Was told to expect those revisions sometime in June.
Thanks
Replies to This Discussion
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Permalink Reply by Evelyn Broxterman on
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Good luck with that. I am having the same thing here in FL, but my 2nd heloc (originated with mortgage just like yours) is being handled by an attorney. They are HARDCORE to deal with. Somebody asked me if the heloc was a non-recourse loan. You might want to look into that.
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Permalink Reply by Terry L. Osburn on
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The HELOC is non recourse as it was generated at time of the first loan and used as down payment to purchase. I have advised my seller to be ready for such. Life just should not be so complicated.
Since it is non recourse the 2nd would lose all if goes to foreclosure.
Evelyn Broxterman said:Good luck with that. I am having the same thing here in FL, but my 2nd heloc (originated with mortgage just like yours) is being handled by an attorney. They are HARDCORE to deal with. Somebody asked me if the heloc was a non-recourse loan. You might want to look into that. -
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Permalink Reply by Laura Marshall on
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I just had a similiar situation - I am in California. As it turns out, the seller neglected to tell me that the "purchase money 1st & 2nd" was actually for a 2nd home, and not originally the primary residence. They used it as a primary residence later, but not at the time of origination. That put a whole different spin on the situation....but we eventually got it closed.
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He told me it was their original primary residence. They did live elsewhere and rented it out for a bit but lived in it at least the first full year and presently for at least a year........ They had other properties they bought.
What was the outcome in terms of what the 2nd would let it go for and was the deficiency language still in there?
Laura Marshall said:I just had a similiar situation - I am in California. As it turns out, the seller neglected to tell me that the "purchase money 1st & 2nd" was actually for a 2nd home, and not originally the primary residence. They used it as a primary residence later, but not at the time of origination. That put a whole different spin on the situation....but we eventually got it closed. -
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They did not remove the deficiency language. The seller just said if the bank pursues it, they will file BK,
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