Under California law, a 'non-recourse' debt is when a loan is made under either one of the following two circumstances:
1. When the loan is made to purchase a one-to-four unit property and the borrower intends to occupy at least one of the units.
2. When the seller carries the back financing for all or a portion of the purchase price of any real property.
In the event of default by the borrower, the lender, or financing seller, this is restricted to recovering the property with no right to proceed against the borrower for any deficiency should the property be worth less than the loan amount.
1. When the loan is made to purchase a one-to-four unit property and the borrower intends to occupy at least one of the units.
2. When the seller carries the back financing for all or a portion of the purchase price of any real property.
In the event of default by the borrower, the lender, or financing seller, this is restricted to recovering the property with no right to proceed against the borrower for any deficiency should the property be worth less than the loan amount.
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