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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Re: Most Likely (read on) Posted by Troy on March 21, 2008 at 9:53 PM In Reply to: Re: Most Likely (read on) posted by k2163 on March 21, 2008 at 8:50 PM Ken, I do not have an 'authoritative citation' for you on that one, nor do I even have a case story for you. This came from my lawyer and as he put it, "If you REFINANCED any purchae money loans, or paid down purchase money HELOC and drew down on it again, the purchase money rule does not apply." Are you thinking maybe he's not right on this one? Troy : You state: : "However, if the 2nd loan was a HELOC and the HELOC was paid down then any re-draw on the HELOC is considered to now be a recourse draw; it is no longer a non-recourse loan. Silly, but true." : I'm not trying to be rude but do you have an authoritative citation for that conclusion? I beleive you may be correct but all the cases I've read do not cover such a fact pattern and I've read most of the big cases. California just for clairification. : Cheers, : Ken : : Matt, most likely the 2nd that was wiped out can NOT pursue a deficiency judgement OR issue a 1099 to the borrower. It was purchase money and therefore w/out recourse. : : However, if the 2nd loan was a HELOC and the HELOC was paid down then any re-draw on the HELOC is considered to now be a recourse draw; it is no longer a non-recourse loan. Silly, but true. : : Troy : : : If the 1st and 2nd liens are California purchase money loans (different lenders) and the first forecloses and thereby wipes the 2nd, is the 2nd thereby prevented from seeking a deficiency judgment against the borrower after the FC because of the purchase money status of the loan? : : : Thanks, Matt Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : Ken, I do not have an 'authoritative citation' for you on that one, nor do I even have a case story for you. This came from my lawyer and as he put it, "If you REFINANCED any purchae money loans, or paid down purchase money HELOC and drew down on it again, the purchase money rule does not apply." : Are you thinking maybe he's not right on this one? : Troy : : You state: : : "However, if the 2nd loan was a HELOC and the HELOC was paid down then any re-draw on the HELOC is considered to now be a recourse draw; it is no longer a non-recourse loan. Silly, but true." : : I'm not trying to be rude but do you have an authoritative citation for that conclusion? I beleive you may be correct but all the cases I've read do not cover such a fact pattern and I've read most of the big cases. California just for clairification. : : Cheers, : : Ken : : : : Matt, most likely the 2nd that was wiped out can NOT pursue a deficiency judgement OR issue a 1099 to the borrower. It was purchase money and therefore w/out recourse. : : : However, if the 2nd loan was a HELOC and the HELOC was paid down then any re-draw on the HELOC is considered to now be a recourse draw; it is no longer a non-recourse loan. Silly, but true. : : : Troy : : : : If the 1st and 2nd liens are California purchase money loans (different lenders) and the first forecloses and thereby wipes the 2nd, is the 2nd thereby prevented from seeking a deficiency judgment against the borrower after the FC because of the purchase money status of the loan? : : : : Thanks, Matt [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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