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My parents own two properties. One is a rental home and the other is a piece of commercial raw land. They own these free and clear. They also own a home in which they got into a predatory loan and each month the balance grows on the principle. They are in jepardy of going into forclosure. Can the bank go after their other properties? If so, how can they try to protect their assets? If they were to sign these properties over to my sister and I, how long would their assets need to be in our names such that the bank could no longer cease them?
Asked on May 13, 2009 under Real Estate Law, California
Answered 15 years ago | Contributor
First and foremost, if they are not yet foreclosed, immediately file a consumer complaint through your California Dept of Financial Institutions and the Attorney General's office. Perhaps a modification of a loan could be made to help. Banking Departments across the country are really stepping this help.
Second, in terms of your other properties -- California has the following: if the bank does indeed foreclose and in the action to sell the property the bank gets LESS THAN WHAT IS OWED ON THE LOAN, the bank can seek a deficiency judgment against the former owners. Once a deficiency judgment is entered, just like any judgment, it can be attached to bank accounts, homes, cars, etc.
SO, it may be in your best interest to start with the administrative process and also have your parents talk to a private attorney. Try www.attorneypages and check his or her disciplinary record at www.calbar.ca.gov under attorney search.
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