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LawTalk
LawTalk, Attorney
Category: Real Estate Law
Satisfied Customers: 37855
Experience:  I have 30 years legal experience. Additionally, in CA I held a Real Estate Broker's license.
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If i were to loan a friend a large sum of money to apply to

Customer Question

If i were to loan a friend a large sum of money to apply to mortgage payments in order to keep his house out of foreclosure, i would like to obtain or have him sign a power of Attorney and a timeline for him to sell his house, get the equity and pay me and several other people off including the IRS. Is there a way to do this?
Submitted: 2 years ago.
Category: Real Estate Law
Expert:  LawTalk replied 2 years ago.
Good afternoon,
I'm Doug, and I'm sorry to hear of the confusion. My goal is to provide you with excellent service today.
In a word, no, you can’t do what you are contemplating---at least not with any safety. If the "friend" defaulted on your deal the best you could do would be to sue him and get a money judgment which would likely be worthless.
The only way your investment will be safe is if you actually provide a refinancing mortgage for him to pay off the entire loan as well as the feds, and take back a note and a Deed of Trust that you can foreclose on.
Any other avenue that you try will leave you at great risk of ending up with nothing. A power of attorney can be revoked at any time by the grantor, and a timeline to sell would not be enforceable---again, your only remedy would be a money judgment with an essentially bankrupt, judgment proof friend with a home subject to a mortgage and potentially a tax lien, and no assets from which to repay you.
You may reply back to me using the Reply link and I will be happy to continue to assist you until I am able to address your concerns, to your satisfaction.
Please remember to rate my service to you so that I can be compensated for helping you.
I wish you and yours the best in 2015,
Doug