What are my rights in a California foreclosure?

What is the California Homeowner Bill of Rights?

It is a group of foreclosure protection laws, many of which started in 2013. Many of them apply to a first mortgage on the home you live in, with 1 to 4 units, when the loan was for personal or family use. Some mortgage companies follow different rules, and not every protection applies to every loan. A lawyer or legal aid office can tell you which laws apply to you.

Does my mortgage company have to contact me before foreclosure?

For loans covered by these rules, generally yes. Your mortgage company, called the servicer, must contact you in person or by phone to look at your money situation and talk about ways to avoid foreclosure, or it must make the specific efforts the law requires to reach you. In that first contact, it must tell you that you can ask for a follow-up meeting, and give you HUD's housing counselor phone number. If you ask for the meeting, it generally must happen within 14 days.

Also, a family member, housing counselor, lawyer, or other helper may be able to get copies of foreclosure notices through a recorded request. Ask the servicer or a qualified professional about how this works.

Does applying for a loan modification stop foreclosure?

Federal law has its own rules and deadlines, including protections for some complete applications received more than 37 days before a sale. Send documents quickly, keep proof that they arrived, and get written confirmation of where your application stands. Sending documents to this website or to our businesses is not the same as your servicer receiving a complete application. No law described here guarantees approval.

Can I appeal a denial?

Do I get one person to talk to?

Often, but not always. For loans and servicers covered by California's single point of contact rule, asking about ways to avoid foreclosure means the servicer must promptly assign a person or team and give you direct ways to reach them. That contact must help coordinate your documents, explain what you need to send, and know the current status of your file. Some servicers are exempt, so this is not a guaranteed right to one named person.

Do foreclosure papers have to be accurate?

Yes. California law requires certain foreclosure documents to be accurate, complete, and backed by reliable evidence. Before recording or filing them, the servicer must review the evidence of the missed payments and its right to foreclose. If you think a document is false or not supported, keep a copy and talk to a lawyer. A paperwork problem does not automatically cancel a foreclosure.

How long can I catch up on missed payments?

Can I get more time to sell my home?

Possibly. For homes with 1 to 4 units, California law, sometimes called AB 2424, allows two delays, each with conditions:

• Listing delay. The trustee must receive a qualifying listing agreement with a California-licensed real estate broker at least 5 business days before the scheduled sale, and the home must already be publicly marketed the way the law requires by then. If all the conditions are met, the sale cannot happen until at least 45 days after the scheduled sale date.
• Purchase agreement delay. After the listing delay has been used, the trustee must receive a qualifying purchase agreement at least 5 business days before the new sale date. It must be a real, fully signed contract, with a price at least equal to the unpaid balance of all recorded loans and liens on the home. It must name the buyer, the price, and the closing date, and be accepted by the escrow company. If all the conditions are met, the new sale date must be at least 45 days after the trustee received the agreement.

Each delay can be used only once. The papers must be sent by certified mail or a tracked overnight courier, with the required tracking, signature, and receipt information. Simply listing the home, getting an offer, or emailing documents does not give you a delay. Always confirm the sale status with the trustee.

Will I still owe money after a foreclosure?

After a California nonjudicial trustee sale, the borrower generally does not owe the rest of the loan that was foreclosed. That does not automatically wipe out every other debt secured by the home, like a second mortgage. Loans used to buy the home, and some refinances, have extra protection.

A qualifying short sale that closes under the lender's written approval can also protect you from owing the rest of that loan under California law. Written approval alone is not enough: the sale has to transfer and the agreed sale money has to be paid. Exceptions apply, including for some business borrowers, fraud or damage to the property, co-signers, and other collateral. Have a lawyer review each loan and any approval letter. Taxes are a separate question.

Can I be locked out right after the sale?

Qualifying renters generally get at least 90 days' notice, and some leases continue after foreclosure. Exceptions apply, and state, federal, or local rules may overlap. Former owners should not assume the renter notice periods apply to them.

What if my servicer breaks these rules?

It depends on the law that was broken, the servicer, how serious the violation is, and the stage of the foreclosure. Some serious violations may let a court stop the sale before the trustee's deed is recorded. After it is recorded, some violations may lead to money damages if the law's requirements are met. These remedies are not automatic.

If a sale is coming up, contact a lawyer or legal aid office right away. You can also complain to the Consumer Financial Protection Bureau, the right state regulator, such as the Department of Real Estate or the Department of Financial Protection and Innovation, or the California Attorney General. A complaint, letter, or lawsuit does not by itself postpone a sale.

What if an old second mortgage suddenly comes back?

Do not assume an old second mortgage went away just because the statements stopped or you got a tax form. California has special protections for some second mortgage practices, including long periods with no contact and missing required notices. Keep every notice and talk to a lawyer right away about whether those protections apply.

Are you in the military?

The Servicemembers Civil Relief Act gives special protections for qualifying military service. For a covered mortgage taken out before military service, a foreclosure during service or within one year after it generally requires a court order or a valid agreement the law allows. Contact a military legal assistance office quickly, and tell your servicer about your service.