Short Sales and Foreclosures

General Foreclosure Information

There are far fewer foreclosures now than the earlier recession, but some owners for different reasons may find themselves in the position of receiving letters from their lender demanding payment. These are properties in the 1-4 unit category.  Do not ignore these letters or phone calls, it's important to respond. Sometimes heirs in probate court or otherwise attempting to sell a relative's property via their trust encounter this situation--the lender wants to hear from the representatives of the property as soon as possible.

Another situation is a homeowner suffering economic hardship due to various personal situations. The lender may be able to work with the owner and set up a plan, or do a loan modification, all depending on the circumstances, which will keep them in their home.

Before bringing yourself to the brink of foreclosure, besides getting legal advice and talking to your lender, contact a Realtor to determine a reasonable current market value should you decide to sell if you have no other options. Many Realtors have had experience with working with the lender during a selling process. It may seem difficult to part with your home at first, but many times property owners have equity to be gained through selling, equity which could be lost if the property ends up in foreclosure, plus a foreclosure entry on your credit report.
 
You still have time to find solutions and avoid losing your property. Maybe your property isn't a mansion, but to you, it is.  1. You should consult with your attorney for complete information on the foreclosure process,  2. your accountant for tax advice, and 3. call your lender.
 
Most foreclosures in California are brought as a non-judicial foreclosure under the California Civil Code  which allows lenders to foreclose upon real property without going to court.  You should also know that California has a Homeowner Bill of Rights since 2013, and renewed in 2019 (Google search this, it's also on California Dept. of Justice website), which gives added protection to the owner before the foreclosure process begins, and also to a renter living in a foreclosed property.
 
The foreclosure process can be complex and I won't attempt to describe all aspects here, but just know that it begins with contact by the lender, then as soon as 30 days later the Notice of Default goes out, then you have 90 days to "cure"  the problem (pay the money), or the lender then records a Notice of Sale, followed by an auction 21 days later, followed by some post-foreclosure requirements.  The entire non-judicial foreclosure time line is also described at the website for the California Courts Self-Help Guide.
 
Also, you may have time to refinance (there are certain lenders who will loan at a higher rate even though an NOD has been recorded) and even if at a higher rate, that is better than losing your home. When your situation has improved, you may be able to obtain a better loan. You may also contact your lender for arranging a "short sale" or "loan modification". Lenders don't really want to take back properties, and are often willing to make an arrangement with the borrower who might otherwise be able to sell the property rather than going into foreclosure. A short sale usually also reflects on your credit report. Contact me for more information on this process.
 
Finally, you should not ignore your situation, as difficult as it is. You may be able to reach an advantageous agreement with your lender. 
 
I can be reached for further assistance or as an information resource. If you would like a copy of the timeline as published by the California Association of Realtors, or the Homeowner Bill of Rights, please contact me. 

If you decide you would like market analysis of your property to try to sell it now or in the future, please call me immediately. You are under no obligation to sell simply because you are provided a market evaluation of your property.

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