If you are facing foreclosure on your home in California, it is no doubt a very scary and stressful time for you and your family. However, it is crucial that you know that you have legal rights during this process. Learning as much as you can about the foreclosure process can help you understand your rights, and determine which action is best to take for your specific situation. Under California’s Civil Code Section 2923.5, you have the right to receive notice from the lender to assess your financial situation and explore options in an attempt to avoid foreclosure. 

Foreclosure in California

In most cases, a loan servicer or lender must wait a full 120 days (4 months) before officially starting any formal foreclosure process on your property. Options are available to you at this time, including a modification, a short sale, or another legal remedy. Additionally, if you are delinquent on payments, the loan servicer or lender must try to contact you no later than 36 days after the delinquency, and each 36 days thereafter. Pertinent California foreclosure statutes are:

  • California Civil Code §§ 2924 through 2924l
  • California Code of Civil Procedure §§ 580a through 580d

California’s Civil Code 2923.5

California has a unique section of its foreclosure code that requires lenders or loan servicers to “assess” the delinquent borrower’s financial situation and to attempt to explore alternative options to final foreclosure. These lenders and loan servicers must attest in a declaration to the court that they have complied with this section of the law and attempted to work with the borrower to reach an option other than foreclosure, either in person or by telephone, and at least 30 days prior to a Notice of Default recording. 

Because many lenders do not follow this section of California’s code, it has led to several borrower lawsuits. These lawsuits by borrowers attempt to either suspend or invalidate a foreclosure due to non-compliance of the lender or loan servicer with regard to this provision. Some borrowers even seek additional monetary damages because this provision was ignored by the lender or loan servicer. Many foreclosures have been stopped through injunctions due to inaction of lenders or loan servicers regarding this provision of California law. 

An Advocate You Can Trust

California’s Civil Code Section 2923.5 involves complex regulations concerning the foreclosure process and creates a private right of action by borrowers if there is non-compliance from lenders or loan services.  

If you believe that your rights as a homeowner may have been violated under California civil code section 2923.5 or you are seeking guidance through this process, contact an experienced attorney at Thaler Law to understand and protect your rights. Seeking the advice of our experienced team may help you to avoid a foreclosure. Contact us at 866-271-5290 or online today for your free consultation.