Apple Valley Apple Valley, California Foreclosure Listings - Apple Valley Apple Valley, California Foreclosures

 California Foreclosures - California Foreclosure Laws

Real estate investors interested in purchasing California foreclosures, or home buyers who are looking for a great deal on HUD homes, should have a basic understanding of  foreclosure laws and how they impact homes appearing on California foreclosure listings.

Mortgage lenders in California can foreclose on properties with a mortgage or deed of trust. Lenders can choose either the judicial foreclosure or non-judicial foreclosure process. Depending on the situation, the  processing timeline for California foreclosures takes about 120 days.

The California Foreclosure Process

Judicial Foreclosure

Lenders must follow the judicial foreclosure process when: 1) the mortgage or trust deed does not contain a power of sale clause; or 2) the lender plans to file a lawsuit for a deficiency judgment against the debtor.

If the lender proves the homeowner defaulted on the loan, and it is entitled to possession of the property, the court issues a Decree of Foreclosure and Order of Sale, which allow the lender to proceed with the foreclosure sale.

Non-Judicial Foreclosure

Most California bank foreclosures go through the non-judicial foreclosure process. The lender must have a deed of trust, which contains a power of sale provision. This clause gives the lender, or its trustee, the legal right to sell the property at a foreclosure auction. The document may include the time, location, and terms of sale.

If the power of sale clause does not have this information, the mortgage lender must take the following steps:

1. Record the notice of sale or notice of default in the county of the property location, at least 14 days before the foreclosure auction date.
2. Mail the notice of sale by certified mail to the borrower, at least 20 days before the sale, and request a return receipt.
3. Post the notice of sale on the property, at least 20 days before the auction.
4. Post the notice of sale in a public place in the county where the California foreclosure auction will take place.

California foreclosure laws require the notice of sale to specific information, including the address of the foreclosed property, and the time and location of the auction. It should also list the trustee's name, address, and phone number. The document must contain wording that states, "the property will be sold at auction."

Homeowners going through California foreclosures have up until five days before the auction to satisfy a default and stop the foreclosure process. Borrowers do not have a right of redemption, and lenders cannot ask for a deficiency judgment, under non-judicial California bank foreclosures.

California foreclosure properties that do not receive bids at the auctions become REO properties.