Sean I saw this posting from you on another site -
wunsacon wrote: “I recall reading that 1st mortgages in CA are non-recourse but that home equity lines are full recourse.”
In practice there is no such thing as a recourse loan in CA, 1st, 2nd, heloc or otherwise. CA offers 2 types of foreclosure, judicial and non-judicial. Only judicial offers recourse, but lenders are VERY unlikely to use it as it takes forever to get through the courts, and then the owner still has a ONE YEAR redemption period. No lender wants to wait 18 months to 2 years in this market to get a house back just to get a judgment that may be difficult to collect anyway.
Can you explain this further, because I see things on this site contradictory to this statement saying the HELOC company can come after me for money lost during a foreclosure? I live in CA and am about $150K upside down on my home, and would like to walk away. Primary mortgage is $365K and HELOC is $135K.
I also saw some postings saying to avoid recourse to not pay the HELOC, but continue paying the 1st mortgage. What are the implications for doing this? My credit would be affected for late payments, correct? Can they send this to a collection agency or is their only recourse to foreclose on the home?
Thanks for any help,