Legal Question in Real Estate Law in California

foreclosure sale during refinancing

We were in foreclosure but were refinancing and Mrtg.Co. was communicating with new lender. A week after the fact our broker finds out Mrtg. Co sold our house at auction and never said a word about the sale or date. If we want our house back now we have to pay $50,000 more to the new company that bought it. Should the Mrtg. Co at least mentioned a sale & date considering they were guaranteed loan payoff via new lender?


Asked on 9/27/06, 6:14 pm

1 Answer from Attorneys
Anthony Roach Law Office of Anthony A. Roach

Re: foreclosure sale during refinancing

You would need to determine whether or not the mortgage company recorded and properly served a notice of default and a notice of sale. There are specific notice requirements for a foreclosure by the power of sale, and if a trustee fails to do these, then the trustee can be liable.

It sounds from your post that you were refinancing and thought that the fact that you were refinancing would stop the trustee's sale. It doesn't. It is like saying, I am going to get the money will stop a collection action. Time is of the essence in a situation like this, and you actually need to have the refinancing completed, prior to the sale to stop the foreclosure sale.

Very truly yours,

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Answered on 9/27/06, 6:22 pm


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