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price of $449,500. The asking price remained $449,500 for
approximately 3 months, but failed to generate any offers.
Stephanie and David reduced the price to $379,500 in
approximately July 1991. Despite the reduction, the Atascadero
property still failed to generate any offers. Stephanie and
David’s real estate agent attributed the lack of interest to a
“soft” market and was of the opinion that a further reduction, to
$350,000, would be necessary to generate any offers. Stephanie
and David were unwilling to reduce the price further and took the
property off the market in August 1991 with the hope that market
conditions would improve.
On August 30, 1991, Stephanie and David consolidated the 33
loans (hereinafter the Atascadero loan) by executing a “Note
Secured By Second Deed Of Trust” in favor of petitioner’s profit-
sharing plan. The note states that Stephanie and David are
individually, jointly, and severally liable for the outstanding
balance of $166,029 plus 12-1/2 percent interest from August 30,
1991, until paid, compounded annually. The note was due 24
months after the date of the note (August 30, 1991), or upon the
sale, transfer, conveyance, or encumbering of the property. The
note recites that the holder may proceed against the makers
independently. The note is secured by a second deed of trust and
assignment of rents to the Atascadero property.
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