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What should homeowners know about California foreclosure laws?
Question:
California foreclosures are found in California Civil Code, Section 2924. These laws provide certain protections for homeowners in California as they relate to foreclosure, the foreclosure process and rights of redemption. It is critical that homeowners understand the following:
Foreclosure process and timing
The California statutes have very strict requirements for filing foreclosure. At a minimum, the process will take one hundred and twenty (120) days. The foreclosure process may be judicial or non-judicial. Most California processes are non-judicial. The mortgage must contain a power of sale clause for a non-judicial foreclosure.
Additionally, a non-judicial foreclosure is considered to be handled by a single action. For the homeowner, this means that once a non-judicial foreclosure process is underway, a lender cannot file a subsequent action to collect a deficiency.
Trustees in the foreclosure process
Unlike other states where a lender assigns a trustee or asks the court to assign one, the title company for the lender typically handles the foreclosure process. Properties that are auctioned are not eligible to be redeemed by junior lien holders (e.g. second mortgages, lines of credit, etc.).
Rights of redemption
The rights of redemption clauses are very complicated in California. In most cases, the loan will be more than ninety (90) days in arrears at the time of the foreclosure notification. During this period of time (known as a pre-sale redemption period) the homeowner may bring the mortgage current at any time.
Additional allowances after auction are even more complicated. If the home is purchased by the lender at the time of the auction, the redemption period is three (3) months. If the property is purchased at auction by another party, the homeowner may redeem the property for up to one (1) year.
Contact a specialist
Because the laws regarding foreclosure are so complicated in California, a homeowner who is facing foreclosure is advised to contact an attorney. This is the only way to ensure that the rights of the homeowner are fully protected. The California foreclosure process is lengthy and complicated and the homeowner does have specific rights that can be protected by an attorney.
This site does not provide legal advice and users of this site should not interpret any of the information presented here as legal advice. The information provided merely conveys general information related to commonly asked legal questions. We are not a law firm and the employees responding to questions are not acting as your legal attorney. You should ultimately consult with a Lawyer for your case.
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California foreclosures are found in California Civil Code, Section 2924. These laws provide certain protections for homeowners in California as they relate to foreclosure, the foreclosure process and rights of redemption. It is critical that homeowners understand the following:
Foreclosure process and timing
The California statutes have very strict requirements for filing foreclosure. At a minimum, the process will take one hundred and twenty (120) days. The foreclosure process may be judicial or non-judicial. Most California processes are non-judicial. The mortgage must contain a power of sale clause for a non-judicial foreclosure.
Additionally, a non-judicial foreclosure is considered to be handled by a single action. For the homeowner, this means that once a non-judicial foreclosure process is underway, a lender cannot file a subsequent action to collect a deficiency.
Trustees in the foreclosure process
Unlike other states where a lender assigns a trustee or asks the court to assign one, the title company for the lender typically handles the foreclosure process. Properties that are auctioned are not eligible to be redeemed by junior lien holders (e.g. second mortgages, lines of credit, etc.).
Rights of redemption
The rights of redemption clauses are very complicated in California. In most cases, the loan will be more than ninety (90) days in arrears at the time of the foreclosure notification. During this period of time (known as a pre-sale redemption period) the homeowner may bring the mortgage current at any time.
Additional allowances after auction are even more complicated. If the home is purchased by the lender at the time of the auction, the redemption period is three (3) months. If the property is purchased at auction by another party, the homeowner may redeem the property for up to one (1) year.
Contact a specialist
Because the laws regarding foreclosure are so complicated in California, a homeowner who is facing foreclosure is advised to contact an attorney. This is the only way to ensure that the rights of the homeowner are fully protected. The California foreclosure process is lengthy and complicated and the homeowner does have specific rights that can be protected by an attorney.
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