Double credit damage when 2 mortgages foreclose? CA

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Double credit damage when 2 mortgages foreclose? CA
Posted by Jinger on February 14, 2008 at 12:29 AM
New topic question bumped from thread below:
http://www.foreclosureforum.com/mb/messages/25212.html
(text follows)

Vivian's post (text):
"Hi. I am in a similar situation - two mortgages with HELOC and considering a foreclosure. Do you know if we would get two foreclosures noted on credit since there are two loans or does it count as one?"

Jinger's post (text):
"That is an interesting question Vivian.
I've been studying this stuff a lot, and am in no way an expert.
I would like clarification on this issue as well.
Here's what I understand: In California, assuming both lenders
initiate 'non-judicial' foreclosure proceedings against you,
each lender will start by recording a Notices of Default against you.
These are recorded and become a public record. Public records are tracked and added to your credit report. So if each lender files a NOD, you'll have 2 negative public records.
Later,(~90 days,) if you don't make other arrangements with the lender, or have the NOD rescinded by bringing your debt current, then the next public record will show up when the lenders file their Notice of Trustee Sale
against you.
So, technically, you could have 4 negative public records which scream 'home loan default issues' which I'm pretty sure stay on your credit report for some time? How bad these public records hit your credit score is another topic.
But if you are talking strictly about how many actual foreclosures show up on your credit report when you only lost one house - that's an interesting discussion.
It seems to me that there should only be one Trustees Deed
issued against one borrower/property, even if the second forecloses first and fails to bring the 1st current, and thus only one record of a completed foreclosure in the public records section for that borrower.
However, the lender who did not get their money back, and did not get the house back, still has to report something in the payment history for that debt.
If the first completes the foreclosure, has anyone seen examples of how that's reported by the lender?
It seems like the balance due should go to 0 (since the homeowner is no longer responsible for any debt because the lender took their one action and foreclosed - getting the collateral back) and that a notation completing
the payment history of that account should read
"account foreclosed, foreclosure, etc."
Has anyone seen credit reports of post foreclosure clients recently?
What does the credit report say?
If the second lender was wiped out, because the first foreclosed first, do they report the debt as 'foreclosed' or something closer akin to 'charged-off?'
If the 2nd lender (who didn't get a Trustees Deed) reports it as 'foreclosure' - wouldn't that have the same
affect as 2 foreclosures on the credit report?
If anybody has seen enough post foreclosure credit reports to comment on how 'foreclosure' is reported, can you please enlighten?"

Follow Ups:

Re: Double credit damage when 2 mortgages foreclose? CA Greg 12:50 AM, 02/15/08 (0)

Post a Followup:

Name : E-Mail : Subject :
Comments: : New topic question bumped from thread below: : http://www.foreclosureforum.com/mb/messages/25212.html : (text follows) : : Vivian's post (text): : "Hi. I am in a similar situation - two mortgages with HELOC and considering a foreclosure. Do you know if we would get two foreclosures noted on credit since there are two loans or does it count as one?" : : Jinger's post (text): : "That is an interesting question Vivian. : I've been studying this stuff a lot, and am in no way an expert. : I would like clarification on this issue as well. : Here's what I understand: In California, assuming both lenders : initiate 'non-judicial' foreclosure proceedings against you, : each lender will start by recording a Notices of Default against you. : These are recorded and become a public record. Public records are tracked and added to your credit report. So if each lender files a NOD, you'll have 2 negative public records. : Later,(~90 days,) if you don't make other arrangements with the lender, or have the NOD rescinded by bringing your debt current, then the next public record will show up when the lenders file their Notice of Trustee Sale : against you. : So, technically, you could have 4 negative public records which scream 'home loan default issues' which I'm pretty sure stay on your credit report for some time? How bad these public records hit your credit score is another topic. : But if you are talking strictly about how many actual foreclosures show up on your credit report when you only lost one house - that's an interesting discussion. : It seems to me that there should only be one Trustees Deed : issued against one borrower/property, even if the second forecloses first and fails to bring the 1st current, and thus only one record of a completed foreclosure in the public records section for that borrower. : However, the lender who did not get their money back, and did not get the house back, still has to report something in the payment history for that debt. : If the first completes the foreclosure, has anyone seen examples of how that's reported by the lender? : It seems like the balance due should go to 0 (since the homeowner is no longer responsible for any debt because the lender took their one action and foreclosed - getting the collateral back) and that a notation completing : the payment history of that account should read : "account foreclosed, foreclosure, etc." : Has anyone seen credit reports of post foreclosure clients recently? : What does the credit report say? : If the second lender was wiped out, because the first foreclosed first, do they report the debt as 'foreclosed' or something closer akin to 'charged-off?' : If the 2nd lender (who didn't get a Trustees Deed) reports it as 'foreclosure' - wouldn't that have the same : affect as 2 foreclosures on the credit report? : If anybody has seen enough post foreclosure credit reports to comment on how 'foreclosure' is reported, can you please enlighten?"

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