Articles Posted in Foreclosures

Articles about foreclosures, including investing in foreclosures and wrongful foreclosure legal claims.

upside-down house
Author: Staff

House flipping has been a popular form of real estate investment for several years, even inspiring several television programs. Unlike many types of real estate investments, house flipping is a very “hands on” process, often requiring a significant investment of time in addition to money. This includes not only repairs and remodeling, but also extensive research into the neighborhood and surrounding area. Once a prospective house flipper has done their homework, it can be a lucrative type of investment. San Diego real estate investors should consider both the potential risks and the possible rewards of house flipping.

What Is House Flipping?

ForeclosureAuthor: Staff

Real estate ownership, both residential and commercial, frequently involves financing some portion of the purchase price with a mortgage loan. Should an owner stop making payments to a lender, the lender can attempt to recover the balance of the loan through foreclosure:  the forced sale of the property at auction, often at a below-market price. This presents opportunities, but also risks, for real estate investors. Understanding the foreclosure process and the potential liabilities involved is essential for California real estate investors who are interested in “distressed” properties.

What Is a Foreclosure?

houseAuthor: Staff

In a recent California appellate case, a plaintiff sued multiple parties after the nonjudicial foreclosure of his home. The court sustained the defendants’ demurrer without providing leave to amend.

The plaintiff challenged the judgment against the bank that instituted the foreclosure sale and one of the entities that serviced the plaintiff’s secured loan. He argued that it was a mistake for the court to determine he hadn’t stated a cause of action against these two defendants and couldn’t amend his complaint to state a cause of action. The court affirmed the judgement.

The case arose in 2007, when the plaintiff borrowed $528 to refinance the loan on his home. The loan was reflected in a note that both parties signed, and it was secured by a deed of trust on his home. The deed of trust identified him as the borrower and also identified the lender, trustee, and beneficiary. It stated that the borrower understood the beneficiary held legal title to the interests specified in the deed of trust but had the right to foreclose and sell the property and take any action required of the lender, if necessary to comply with law or custom. It also allowed the note to be sold multiple times without giving the plaintiff notice.

The beneficiary entity assigned the note to Mellon Bank, which was a trustee for a securitized investment trust and one of the defendants. The assignment was signed by an assistant secretary and recorded. The trust was organized under New York laws and was governed by a servicing agreement that required a servicer to make certain advances on delinquent loans. One day after the assignment was executed, another entity recorded a notice of default, stating an owed amount of $35,254.26.

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