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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] With better info we're not even close.. Posted by Ward-CA- on April 29, 2003 at 12:03 AM In Reply to: Re: Probably a squeaker posted by ken on April 29, 2003 at 8:13 AM : Ward, Thanks for the help. To clarify, : I did record the Judgement 8 years ago. The home is located in So Cal. There are no other recorded liens before mine other than the first and second. In light of the response that I've received : My question is now should I try to reinstate the first or buy them out completely and push my judicial forclosure to maximize my stituation or sit back and wait for the 1st to proceed with the forclosure sale. : Also how does the homestead exemption play into this? This is a primary residence and both parties live there? As far as geting the house. That would be an option that I have considered. : Thanks again for your insight. : Ken =•=•=•=•=•=•=•=•=•=•= Ken, Since you’re a junior lienor, you have the Right of Reinstatement (ROR) allowing you to simply reinstate the delinquency owing on the 1st any time up to 5 business days before the scheduled foreclosure sale of the 1st. During the 5 days it’s up to the discretion of the foreclosing beneficiary to allow a reinstatement of delinquent payments versus requiring the full payoff of their loan. Most institutional lenders will allow the ROR even during the last 5 days. That would be a lot cheaper than paying the 1st completely off. But now that you’ve disclosed your $175K judgment has been recorded as an abstract of judgment for 8 years it changes your situation dramatically. Judgments earn interest at the legal rate of 10.0% per annum beginning from the court’s date of entry of the judgment. So if the original judgment amount is $175,000 and it’s earning 10% interest per year, then in the past 8 years it has grown to approximately $315,000 = (175,000) + (17,500 x 8). So if the 1st equals $105K and the 2nd equals $35K and your 3rd lien equals $315K then the total indebtedness against the property is $455,000 dollars. If the property is only worth $400,000 then your judicial foreclosure proceeding is going to come to a grinding halt at the homestead hearing. At that hearing you have to show the court that the fair market value (FMV) of the property is at least equal to the total of all of its debts and liens PLUS the amount of the debtors’ homestead exemption! Wow, that could make a grand total of $530K to $580K that the house might have to be worth before you can proceed to your Sheriff’s sale of the property. If you have an attorney who is processing your judicial foreclosure then you really have to worry about their competence. They should have figured out these numbers long before they filed the judicial foreclosure. A good bit of news is it looks like you have nothing to worry about concerning any bankruptcy the judgment debtors might try to use to wipe out your judgment. But a word of advice. Make a reminder to yourself to file a Renewal of Judgment form with the court when your judgment gets to 9.5 years old. It’s a very simple task, but it does require that you send a copy of your renewal request to the judgment debtors, giving them enough time to file their response to your request, before the judgment goes stale at ten years. The only thing that matters with the court that would stop a renewal is if the debtors can show that they’ve already paid off the judgment. You ask how a homestead works. A homestead acts to temporarily bar a judgment creditor from completing a judicial foreclosure against a judgment debtors’ home until the creditor can prove at a homestead hearing that the subject property has a FMV totaling more than all liens and encumbrances (including the judgment amount and its accumulated 10% interest) against the property plus the applicable homestead exemption amount. So my advice is to drop the expense of the judicial foreclosure and let the foreclosure of the 1st continue on to its foreclosure sale. And, as I said earlier, given this Seller’s market the yuppies at that sale will bid the sales price up to $320K to $340K. That will pay off the 1st and 2nd and pay you the balance of about $200K towards your $315K judgment plus interest. Your $115K balance owing will survive the 1st’s foreclosure since your judgment is a general lien. It won’t be attached to the foreclosed property after the sale but it will still exist and prevent the judgment debtors from selling any other property they might own in the county and prevent them from buying any property in the county until you’re paid. Hope this helps. Follow Ups: Re: With better info we're not even close.. Ken Lofrano 11:28 AM, 04/30/03 (1) Back to my original analysis... Ward-CA- 5:46 PM, 04/30/03 (0) Post a Followup: Name : E-Mail : Subject : Comments: : : Ward, Thanks for the help. To clarify, : : I did record the Judgement 8 years ago. The home is located in So Cal. There are no other recorded liens before mine other than the first and second. In light of the response that I've received : : My question is now should I try to reinstate the first or buy them out completely and push my judicial forclosure to maximize my stituation or sit back and wait for the 1st to proceed with the forclosure sale. : : Also how does the homestead exemption play into this? This is a primary residence and both parties live there? As far as geting the house. That would be an option that I have considered. : : Thanks again for your insight. : : Ken : =•=•=•=•=•=•=•=•=•=•= : Ken, : Since you’re a junior lienor, you have the Right of Reinstatement (ROR) allowing you to simply reinstate the delinquency owing on the 1st any time up to 5 business days before the scheduled foreclosure sale of the 1st. During the 5 days it’s up to the discretion of the foreclosing beneficiary to allow a reinstatement of delinquent payments versus requiring the full payoff of their loan. Most institutional lenders will allow the ROR even during the last 5 days. That would be a lot cheaper than paying the 1st completely off. : But now that you’ve disclosed your $175K judgment has been recorded as an abstract of judgment for 8 years it changes your situation dramatically. : Judgments earn interest at the legal rate of 10.0% per annum beginning from the court’s date of entry of the judgment. So if the original judgment amount is $175,000 and it’s earning 10% interest per year, then in the past 8 years it has grown to approximately $315,000 = (175,000) + (17,500 x 8). : So if the 1st equals $105K and the 2nd equals $35K and your 3rd lien equals $315K then the total indebtedness against the property is $455,000 dollars. If the property is only worth $400,000 then your judicial foreclosure proceeding is going to come to a grinding halt at the homestead hearing. : At that hearing you have to show the court that the fair market value (FMV) of the property is at least equal to the total of all of its debts and liens PLUS the amount of the debtors’ homestead exemption! Wow, that could make a grand total of $530K to $580K that the house might have to be worth before you can proceed to your Sheriff’s sale of the property. : If you have an attorney who is processing your judicial foreclosure then you really have to worry about their competence. They should have figured out these numbers long before they filed the judicial foreclosure. : A good bit of news is it looks like you have nothing to worry about concerning any bankruptcy the judgment debtors might try to use to wipe out your judgment. : But a word of advice. Make a reminder to yourself to file a Renewal of Judgment form with the court when your judgment gets to 9.5 years old. It’s a very simple task, but it does require that you send a copy of your renewal request to the judgment debtors, giving them enough time to file their response to your request, before the judgment goes stale at ten years. The only thing that matters with the court that would stop a renewal is if the debtors can show that they’ve already paid off the judgment. : You ask how a homestead works. A homestead acts to temporarily bar a judgment creditor from completing a judicial foreclosure against a judgment debtors’ home until the creditor can prove at a homestead hearing that the subject property has a FMV totaling more than all liens and encumbrances (including the judgment amount and its accumulated 10% interest) against the property plus the applicable homestead exemption amount. : So my advice is to drop the expense of the judicial foreclosure and let the foreclosure of the 1st continue on to its foreclosure sale. And, as I said earlier, given this Seller’s market the yuppies at that sale will bid the sales price up to $320K to $340K. That will pay off the 1st and 2nd and pay you the balance of about $200K towards your $315K judgment plus interest. : Your $115K balance owing will survive the 1st’s foreclosure since your judgment is a general lien. It won’t be attached to the foreclosed property after the sale but it will still exist and prevent the judgment debtors from selling any other property they might own in the county and prevent them from buying any property in the county until you’re paid. : Hope this helps. Optional Link URL: Link Title: Optional Image URL: [ 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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