recourse and non-recourse clarification

[SD Realtor]

I always was under the impression that any refi is always recourse regardless of what the money was used for…

Again, totally a speculative statement, not advice, not a CPA… just a grunt making a post.

SD Realtor

[SD Realtor]

I always was under the impression that any refi is always recourse regardless of what the money was used for…

Again, totally a speculative statement, not advice, not a CPA… just a grunt making a post.

SD Realtor

[DaCounselor]

Refi’s are typically recourse loans, but of course you have to look at the language in the loan docs to determine the terms. Purchase money loans are non-recourse despite any language in the loan docs that may suggest recourse is permitted. The Civil Code doesn’t allow recourse on purchase money loans, including a HELOC taken out as the 20% of an 80/20 deal.

[DaCounselor]

Refi’s are typically recourse loans, but of course you have to look at the language in the loan docs to determine the terms. Purchase money loans are non-recourse despite any language in the loan docs that may suggest recourse is permitted. The Civil Code doesn’t allow recourse on purchase money loans, including a HELOC taken out as the 20% of an 80/20 deal.

[DaCounselor]

Refi’s are typically recourse loans, but of course you have to look at the language in the loan docs to determine the terms. Purchase money loans are non-recourse despite any language in the loan docs that may suggest recourse is permitted. The Civil Code doesn’t allow recourse on purchase money loans, including a HELOC taken out as the 20% of an 80/20 deal.

[DaCounselor]

Refi’s are typically recourse loans, but of course you have to look at the language in the loan docs to determine the terms. Purchase money loans are non-recourse despite any language in the loan docs that may suggest recourse is permitted. The Civil Code doesn’t allow recourse on purchase money loans, including a HELOC taken out as the 20% of an 80/20 deal.

[Chance the Gardener]

Refi is not purchase money

Unequivocally, proceeds from a refinance loan are not purchase money. Lenders of purchase money are required to disclose the non-recourse nature of a loan in California. Refinance lenders are not required to inform you that refinancing forfeits your protection under Civil Code section 580b. Here is a link to a law professor's article calling for a correction to this problem. Note in the conclusion that the least likely to succeed solution is to extend 580b protection to borrowers who refinanced. http://works.bepress.com/cgi/viewcontent.cgi?article=1000&context=george_kuney

[Chance the Gardener]

Refi is not purchase money

Unequivocally, proceeds from a refinance loan are not purchase money. Lenders of purchase money are required to disclose the non-recourse nature of a loan in California. Refinance lenders are not required to inform you that refinancing forfeits your protection under Civil Code section 580b. Here is a link to a law professor's article calling for a correction to this problem. Note in the conclusion that the least likely to succeed solution is to extend 580b protection to borrowers who refinanced. http://works.bepress.com/cgi/viewcontent.cgi?article=1000&context=george_kuney

[Chance the Gardener]

Refi is not purchase money

Unequivocally, proceeds from a refinance loan are not purchase money. Lenders of purchase money are required to disclose the non-recourse nature of a loan in California. Refinance lenders are not required to inform you that refinancing forfeits your protection under Civil Code section 580b. Here is a link to a law professor's article calling for a correction to this problem. Note in the conclusion that the least likely to succeed solution is to extend 580b protection to borrowers who refinanced. http://works.bepress.com/cgi/viewcontent.cgi?article=1000&context=george_kuney

[Chance the Gardener]

Refi is not purchase money

Unequivocally, proceeds from a refinance loan are not purchase money. Lenders of purchase money are required to disclose the non-recourse nature of a loan in California. Refinance lenders are not required to inform you that refinancing forfeits your protection under Civil Code section 580b. Here is a link to a law professor's article calling for a correction to this problem. Note in the conclusion that the least likely to succeed solution is to extend 580b protection to borrowers who refinanced. http://works.bepress.com/cgi/viewcontent.cgi?article=1000&context=george_kuney

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