CA Foreclosure Law

In California, a lender may foreclose on deeds of trust or mortgages in default by using either a judicial or non-judicial foreclosure process.

What is Judicial Foreclosure?

This type of foreclosure process involves filing a lawsuit to obtain a court order to foreclose, when there is no power of sale in the mortgage or deed of trust. Typically after the court declares a foreclosure, your home will be auctioned off to the highest bidder. Under a judicial foreclosure, lenders may seek a deficiency judgment and under certain circumstances the borrower may have up to one year to redeem the property.

What is Non-Judicial Foreclosure?

This type of foreclosure process is most common in California. The process is used when a power of sale clause exist in a mortgage or deed of trust. The "power of sale" clause is the clause in a deed of trust or mortgage in which the borrower pre-authorizes the sale of the property to pay off the balance of the loan if there is a default. Although lenders give up their right for a deficiency against the borrower, this is the preferred process due to the expediated time frame.

Non-Judicial Foreclosure Timeline

Day 1

Within 10 days

Within 1 month

After 3 months

25 days prior to sale

At least 20 days prior to the sale

Within 10 days from the first publication of Notice of Sale

14 days prior to sale

Sale Date

Record the Notice of Default

Copies of the recorded document (NOD) are mailed to the Trustor and anyone requesting special notice

Notice of Default is mailed to all parties, persuant to CA Civil Code 2924c

At the end of the 3 month period, prepublication period, the Lender can instruct the Trustee to set a sale date

Notice to the IRS must be given, if required

Publish Notice of Sale, post Notice of Sale, and mail Notice of Sale

Send beneficial request for property directions

Right to reinstate expires

Property is sold to the highest bidder

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