"Junior" lienholders Should File Wrongful Foreclosure Actions

As will be discussed in the workshops coming up in California (check the schedule), it isn’t just the homeowner who could be filing wrongful foreclosure actions for damages. Junior lienholders should be doing the same. They are the association that maintains the property or common elements, second mortgage holders, holders of HELOCS etc.

When THEY file, it will institution vs institution and the playing field will be more even. If the foreclosure was accomplished by a credit bid, and nearly all of them fall into that category, then all it takes is an allegation that the bidder was not the secured creditor and therefore the deed on foreclosure was invalid because it was wrong for the auctioneer to accept the credit bid.

Presto the first lien is gone and the the next “junior” lienholders move up in priority leaving the so-called first loan in the dust. That leaves the homeowner with a workable debt in which he can maintain the home, pay the junior lienholders, and tell the pretender lender to go pound salt.

Tags: ASSOCIATIONS, HELOC, junior lienholders, second mortgages, wrongful foreclosure
Posted in bubble, Corruption, Eviction, securities fraud |