Foreclosure

# Foreclosure in California ## Overview Foreclosure is the legal process by which a lender recovers secured property when a borrower defaults. California has detailed statutory protections for both lenders and borrowers. Because California primarily uses deeds of trust rather than mortgages, non-judicial foreclosure (the trustee's sale) is the standard method — faster and cheaper than court proceedings. The two core California anti-deficiency statutes — CCP § 580b (purchase money) and CCP § 726 (one action rule) — are among the strongest borrower protections in the United States and are frequently tested. --- ## Non-Judicial Foreclosure — The Trustee's Sale Process ### Step 1: Notice of Default (NOD) — Civil Code § 2924 When a borrower defaults (typically 3+ months of missed payments), the beneficiary (lender) records a Notice of Default at the county recorder. Civil Code § 2924(a) requires the NOD to include: - Property identification (names of trustor and recording data) - "A statement setting forth the nature of each breach actually known to the beneficiary" - Documentation that a breach of the secured obligation has occurred Critical protection: § 2924(a)(6) restricts who can initiate foreclosure: "An entity shall not record or cause a notice of default to be recorded…unless it is the holder of the beneficial interest" — this requirement emerged from the post-2008 robo-signing abuses and is now codified. After the NOD is recorded: - "Not less than three months shall elapse from the filing of the notice of default" before the Notice of Trustee's Sale may be given (§ 2924)…