Legal Question in Real Estate Law in California

Re: home forclosure

To fully answer your question would take volumes, as California laws are enormously complex and vary depending upon the type of property and the type of the loan, and the type of the foreclosure. There are two types in California: judicial and non-judicial. A lender can select which type to pursue and the choice usually depends upon whether the loan is purchase money or non-recourse, or if the lender is able to pursue a deficiency judgment. If the lender does a non-judicial foreclosure under the power of sale provisions of the deed of trust AND bids in the entire sum owed, he can do nothing else and pursue no further remedies or monies. Any lender who is junior to the foreclosing lender, however, such as a holder of a second or third deed of trust, can still pursue the borrower for a money judgment if his security interest was extinguished and if he is not "purchase money". A lender can elect to sue a borrower for judicial foreclosure if the loan being foreclosed upon is a refinance or other non-purchase money loan, OR if there was any fraud/false statements, etc. in the making of the loan (such as a borrwer lyng about his income, assets, etc.) When a lender does this and prevails, the house is sold to satisfy the loan at a sheriff's sale and any additional monies not received at the sale become a personal judgment against the borrower(s) which can be collected from ANY asset.