When a California homeowner fails to pay a mortgage loan, the lender can use the foreclosure option to rectify the default loan. California foreclosure law allows the lender to sell the property in order to recoup the money the borrower owes.

Type of California Foreclosures

California law allows for judicial and non-judicial foreclosures. Judicial foreclosures require filing a lawsuit and non-judicial require no lawsuit.

Typical California Foreclosure

The majority of foreclosures in California involve the non-judicial foreclosure, as the majority of mortgage contracts contain a "power of sale" clause. A power of sale clause in a mortgage contract allows the lender to foreclose without filing a lawsuit.

Notice of Sale

The law requires lenders to go through a notification process before selling a home in foreclosure. The process includes sending a certified a notification, at least 20 days prior to the sale, to the borrower stating the home will be sold, posting a notice on the property explaining the sale, posting a notice in a public place listing the time and place of the sale and recording the loan default, within 14 days of the sale, in the county in which the property is located.

Cure the Default

The borrower can cure the default up to 5 days before the sale. The borrower can cure the default by paying the amount owed to bring the loan current.

Sale of Property

The property is sold by means of an auction in a public place, at the location and time listed on the prior notices.

Source:

United States Foreclosure Law: California Foreclosure Law Summary

Foreclosure.com: How are mortgage liens treated in California?

Foreclosures.com: State Foreclosure Laws California

More Information:

Information from the California Legislative Branch