Friday, August 5, 2011

Short Sale Deficiencies – NO Judgment in California

California Civil Code Section 580e says:
Unless other exempt, when carrying out a short sale there will be NO judgment for the deficiency on the FIRST deed of trust on  residential property.  The lender of the FIRST loan cannot come after you for the remaining balance.  The short sale approval issued by your lender is their consent to accept the sale proceeds as full payment.

Nevertheless, its always a good idea to obtain the release of further liability from the lender in writing.

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