Legal Question in Credit and Debt Law in California

Re: Abstract of Judgment and the sale of real property

There's no time limit in which the debtor has to pay. The judgment creditor can force a sale of the house anytime. If a creditor wanted to force a sale of the house, the creditor would have to pay off the first mortgage, and any other senior liens, and pay the debtor the amount he is entitled to as a homestead exemption (minimum $50,000), and after paying all those sums, would own the debtor's house.

I haven't seen any instances of a creditor doing this. As a practical matter, judgment creditors normally just wait until the house is sold or refinanced, and they get paid off at that time, with interest.

Re: Abstract of Judgment and the sale of real property

Once the abstract of judgment has been filed and recorded, the creditor can initiate a foreclosure by filing the proper papers. A title search can tell you if there's sufficient equity in the property, after accounting for any applicable homestead exemptions, to cover the amount owed to the creditor.

Most people just record the abstract and wait for the property to be sold or refinanced, as the lien must be taken care of when a sale or refinance occurs. In the meantime, the judgment will be earning interest, usually at the maximum legal rate (10%).