Home > Foreclosure > 5 Things You Should Know About California Foreclosure Laws

5 Things You Should Know About California Foreclosure Laws

Unfortunately, banks depend on the ignorance of homeowners to enforce wrongful foreclosures and therefore foreclose without proper authority to do so. As the new home foreclosure rate continues to edge up, it’s important to understand a few things about foreclosure laws in your state before falling victim to wrongful foreclosure.

While these are just simple facts about foreclosure laws that most homeowners overlook, if you are facing foreclosure, we strongly recommend speaking with a knowledgeable real estate attorney to determine your best options and to assist you in making sure you are not victimized by an unlawful foreclosure.

1.)    Lenders Must Follow State Foreclosure Laws
Lenders often don’t follow state foreclosure laws, a problem that has given way to on-going investigations into foreclosure processes especially using Robo-Signers for mortgage assignment transfers. Every state has rules and procedures that lenders must follow in order to legally foreclose on a homeowner and violating any foreclosure law can void foreclosure sale.

2.)    California’s Judicial And Non-Judicial Foreclosures
The primary method of foreclosure in California involves what is known as non-judicial foreclosure. This type of foreclosure does not involve court action. When the deed of trust is initially signed, it will usually contain a provision called a power of sale clause, which upon default allows a trustee to sell the property in order to satisfy the underlying defaulted loan.

California non-judicial remedies have stringent notice requirements and the mortgage documents are required to contain the power of sale language in order to use this type of foreclosure method. Judicial foreclosures are permitted in California and these usually occur when no power of sale language is included in the loan documents.

3.)    Power of Sale Notice Requirements:
The non-judicial power of sale foreclosure is carried out as follows:

  • Recorded in the county where the property is located at least fourteen (14) days prior to the sale
  • Mailed by certified, return receipt requested, to the borrower at least twenty (20) days before the sale
  • Posted on the property itself at least twenty (20) days before the sale
  • Posted in one (1) public place in the county where the property is to be sold.

4.)    How long does it take to foreclose a property in California?
Depending on the timing of the various required notices, it usually takes a minimum of 120 days to effectuate an uncontested non-judicial foreclosure. This process may be delayed if the borrower contests the action in court, seeks delays and adjournments of sales, or files for bankruptcy. The borrower has up until five days before the foreclosure sale to cure the default and stop the process.

5.)    Stop foreclosure
The defaulting borrower may prevent the foreclosure sale by paying all arrearages up to five days before the sale. And, in a recent phenomenon, many lenders are willing to accept partial payments or renegotiate your mortgage in lieu of foreclosure.

Additionally, you may qualify for a loan modification to help you get back on track with more affordable mortgage payments.

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