Come on guys. You should know by now…We live in the nanny CA state… Even if you fvck up, it’s still not your fault, and you still have rights!!!! It’s someone else’s fault…
Both are technically recourse. BUT…
1) Thanks to a law that goes into effect 2013 (Senate Bill 1069)…. primary home refinances are now considered non-recourses, provided there wasn’t a cash-out… And if there was, only the cashed-out portion above the original loan amount is considered recourse….
So… One can now be officially fiscally irresponsible after a primary refinance after Jan 1,2013, provided their’s no second,third, forth loan on it.
But beside that…
2) In California…there’s a One Action Rule. A creditor is only allowed to take one action on you… So provided you only have 1 loan on the property even if it is recourse, they can pick either foreclosure or something else, but not both.
Morale Hazard…In CA? Nonexistent…Welcome to the party!
At any rate, no way I’m gonna default, because the bank stands to win if they FC on me…I’m not exactly financed near 100%…In fact, my LTV is ridiculously low on the primary and reasonable on the primary. Plus, although I’m not factoring it in, the investment has appreciated a bit since I bought it.
