While they’re unfortunate, foreclosures are very common. When you take out a mortgage loan to get a house, the lender assumes the risk that you won’t repay the loan. To safeguard against these loses, the lender retains the right to foreclose on your property and market it for the unpaid loan balance. Every state has its rules and regulations concerning the foreclosure process. Many states, such as California, promote every step including the last foreclosure deed.
Notice of Default
As soon as you default on your mortgage payments, the lender contacts you about the status of your loan. In California, the lender has to offer some form of assessment of your financial situation or information that will help you to prevent a full foreclosure. However, if you can not make a payment in a specific period after the first touch — typically 30 days — the lender issues a notice of default. It is filed on public record with the county recorder’s office where the property is situated.
Notice of Sale
Once the notice of default is filed, the lender should wait a specific period for you to remit a payment — generally that is about 90 days — before the lender can actually hold a sale to the property. If you are unable to pay back what you owe within that span, the lender issues a notice of sale. This file is also filed on public record, as well as being posted on the outside of your house and at the courthouse. The note is also advertised in a local paper. Normally the sale is scheduled for about 21 days after the notice will be filed.
Foreclosure Deed
Anyone can attend the foreclosure sale and bid on the property. Commonly, the lender enters the starting bid at the sum of the unpaid loan balance. The winning bidder is issued a deed granting him possession of this property. This deed has to be filed on public record. In a upcoming title investigation, the bidder will look as the property’s owner or title holder. If no one bids on the property, the lender takes possession.
Factors
Most foreclosures in California have been nonjudicial — done without going to court — so the trustee working on behalf of the lender manages the foreclosure proceedings and conducts the sale. He’ll also issue and sign the foreclosure deed if the sale is successful. At times, judicial foreclosures, which involve a lawsuit, will happen. In this event the entire case a part of public record, exactly as with any other lawsuit.