Legal Question in Real Estate Law in California

That is impossible to answer without a great deal more information starting with the details of how title to the property and the deed of trust were granted and held and the timing of each.

I agree with Mr. McCormick. I can't tell if you are talking about a situation where only one co-owner signed a deed of trust, or are own an interest subsequent to the deed of trust, in which case your interest would be "subject to" the deed of trust.

First, I assume that the property in question is real property (real estate) and that the foreclosure is by trustee's sale. The next question would be whether the entire property serves as collateral, or only the interest of the debtor-owner. Then, a lawyer would want to know the sequence of events that led to the ownership and the indebtedness being other than co-extensive.

The foreclosure sale can include only the interest(s) that are secured by the deed of trust. Sometimes this means that the trustee will be selling a partial interest. In such cases, the non-debtor co-owner will end up with a new co-owner after the sale. Lenders generally don't like lending against a half interest in a residence, however; the market for partial interests in smaller properties is not good.

In other circumstances, perhaps more often, the lender's lien will cover the entire property, generally because the non-debtor acquired his/her/its interest after the loan was made and the lien imposed. (Oftentimes, transferring an interest to a non-debtor is an act of default under the terms of the deed of trust; other times, lenders will permit such a transfer). If the lien covers the entire property, and is senior (prior) to the claim of the non-debtor co-owner, the trustee can sell the entire property but the co-owner will be in line to receive a portion of the sale proceeds, if sufficient.

So, the question may boil down to whether the lien encompasses both owners' interests, without regard to whether Owner B is a debtor on the loan or not.