Foreclosure Proceduresby Dean EadesIf you own a home anywhere in the San Diego area of California and can relate to the recent down turn in the real estate industry regarding foreclosures, you will want to have a basic understanding of the sometimes confusing components.  Foreclosure Type - California typically has two types of foreclosures. A Judicial Foreclosure requires a deficiency judgment. Once the home is sold, if the amount of the sale is less then the amount owed by the borrower, the unpaid balance will be the deficiency amount. The lender may be able to then sue the borrower for this amount. This can only be done in a judicial foreclosure which pertains to only about 5% of California loans. A Trustee Sale allows some lenders to exercise a clause in the deed of trust that allows them to sell the property themselves and re-coop as much as they can. The borrower would first receive a "Notice of Default" against the home. NOTE: This can not be done until the loan is in default for 3 months and 21 days. Once the sale occurs, if the lender sells the house for less then the loan the lender is NOT permitted to sue the borrower for the difference as with the judicial foreclosure. What's a Borrower to do? |