Posted on: 06th Feb, 2010 08:20 am
hi there, i have a home in california and i wanted to see if anyone knew much about the one-action rule with two lenders that are the same. i thought i read somewhere if my first and second mortgage on the house are with the same lenders then they only can collect on their debt with one action together. in other words, if the 1st mortgage forecloses and doesn't receive the full loan amount, the 2nd mortgage can't sue me for deficiency because it's the same lender and they have already gone through their one action. is this true?
i pulled this from the following website: http://definitions(dot)uslegal(dot)com/o/one-action-rule/...
The one action rule is a rule of law that forces a lender to bring only one court action or proceeding against a borrower in a foreclosure. For example, in California, Code of Civil Procedure § 726 has been construed to mean that in the event of default, a secured creditor must, in a single action, first exhaust all its security as a condition of obtaining a monetary deficiency judgment against the debtor personally. If the secured creditor does not resort to all its security before obtaining a money judgment on the underlying debt, the secured creditor may be deemed to have made an "election of remedies" and to have waived the balance of its security.
i don't see that it negates their right to seek a deficiency judgment, but it does put restrictions on how they'd be able to do it.
i'm not a lawyer, so my opinion is not binding in any way, shape or form, but that's how i see it.
you ought to contact your own lawyer, and if you don't have one, i'd say get in touch with the state's attorney general's office for clarification.
The one action rule is a rule of law that forces a lender to bring only one court action or proceeding against a borrower in a foreclosure. For example, in California, Code of Civil Procedure § 726 has been construed to mean that in the event of default, a secured creditor must, in a single action, first exhaust all its security as a condition of obtaining a monetary deficiency judgment against the debtor personally. If the secured creditor does not resort to all its security before obtaining a money judgment on the underlying debt, the secured creditor may be deemed to have made an "election of remedies" and to have waived the balance of its security.
i don't see that it negates their right to seek a deficiency judgment, but it does put restrictions on how they'd be able to do it.
i'm not a lawyer, so my opinion is not binding in any way, shape or form, but that's how i see it.
you ought to contact your own lawyer, and if you don't have one, i'd say get in touch with the state's attorney general's office for clarification.
hey, i can't even put the website's address up there in reasonable fashion. why would you listen to me when you can call the AG?
You can read it at foreclosuredefenseresourcecenter.com
Good luck!
Good luck!
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