Legal Question in Real Estate Law in California

Re: Forclosure on house owned by three siblings

If the loan is secured by a deed of trust on the house, default on the loan gives the lender the right to institute foreclosure proceedings. After notice to the borrower and a period of time, the trustee holding the trust deed will be instructed to give notice of, and carry out, a public auction of the house.

You need to understand your options and have a good grasp of the economics of the options so you can choose the one that best handles the situation from your point of view. The options include buying out the siblings, being bought out, paying the loan arrearages yourself, paying off the loan in full, buying the note from the lender, waiting for a foreclosure sale and bidding to buy the property, and perhaps several others involving negotiation with the brother.

There is probably enough money at stake -- as well as family relationships -- to make it worth while to learn about trust deeds and foreclosures and/or hire a real-estate attorney to counsel you personally. Handling co-owned property disputes is a rather complex and sometimes ticklish matter that calls for a sound understanding of the law, foreclosure procedures, and the economics of trust deed lending and lawsuits to enforce contribution from the co-owners.

You have many options, none clearly better than another until the economics, the law, and your personal desires vis-a-vis the house and your desire for family harmony are weighed.

Re: Forclosure on house owned by three siblings

Yes. The lender has its security in the property whether it is owned by 1 or a million people. Your brother might be liable for your lost equity but you'll have to wait until the property is taken. Your only option now is to cure any default.