A financial set back can befall you at any time and make you unable to sustain your mortgage payments. When you find yourself in such a compromising situation, the reality of a foreclosure sets in. It is difficult for you to think of ways of raising money to save your coveted home. This becomes even worse in the situation that you lose employment or suffer a financial handicap due to unforeseen events. You may lag in payments, or be unable to finance your mortgage at all. At times, it becomes impossible to update your payments, and a foreclosure is imminent. After the foreclosure sale date, the only thing on your mind is that you have lost your home. When in such distress, it is comforting to understand foreclosure laws in California and to know your options. Consulting an attorney who is well conversant with California bankruptcy laws can be of great importance. Our attorneys at Los Angeles Bankruptcy Attorney can help analyze your case and possibly recover your home.

What is the Foreclosure Process?

Since it is not easy for many aspiring homeowners to buy homes from their savings, many end up taking a mortgage. Once you take a mortgage, the party that lends you the loan to buy a house will have an interest in the property until the day you will fully settle the loan amount plus interest. If, at some point, you default in paying the loan, the lender or the bank that extended your credit can sell the property to recover the remaining mortgage amount. This process of recovery is known as the foreclosure process. Foreclosures are common as many people default in monthly payments and end up failing to pay eventually. The court can supervise the foreclosure process known as a judicial sale, or the lender can sell the property without court intervention known as foreclosure by power of sale.

Judicial Sale Foreclosure

If your property is sold by judicial foreclosure, it means the court will supervise the sale process. This judicial sale process is popular with many banks and lenders as the first proceeds go to clear the mortgage. After settling the mortgage, other interest holders come second and the balance if any comes to you, the mortgagor. In a judicial sale, the court requires the lender to be cautious and ensure the inclusion of all interested parties in the case. In so doing, the court ensures that the property changes hands legally and transparently, and the purchaser becomes a new legal owner to the property.

If you had parties who had acquired an interest in your mortgage after execution, they must be brought on board on judicial foreclosure. These interests may include leases, easements, or liens to the mortgage, and they will be enjoined in the case. The court will ensure all settlements are done before concluding the judicial foreclosure sale. The parties are referred to as necessary parties; the court enjoins and settles the parties needed to diminish their entitlement to the property upon foreclosure.

Parties who had an interest in your mortgage before it was executed are also enjoined in the judicial foreclosure sale as proper parties. Proper parties are not included without their consent since the foreclosure will not affect them. Appropriate parties are considered voluntary parties in the case. But courts do enjoin the proper parties to the case to make clear their position regarding the foreclosure. The process of judicial foreclosure is conducted by a court official or by a sheriff who makes the sale of the property at the foreclosure. The lender or bank is free to make a bid for the property being mortgaged.

Power of Sale Foreclosure

Where the mortgage holder, in many cases a bank or lender, decides to sell the mortgage without court supervision, it is foreclosure by power of sale. The process of foreclosure by power of sale is not as involving as judicial sale foreclosure. The procedures are similar in some ways in that money realized goes first to the lender or bank then to other interested holders, and then you are paid the balance. This process of foreclosure is not allowed in case of absolute deed in the mortgage.

 It must also be specified in the mortgage deed that this type of foreclosure was allowed. However, at some point, the parties involved in the foreclosure seek court intervention, especially in matters relating to title deeds. In a foreclosure by power of sale, a deed of trust is a requirement; the deed of trust will transfer your property from the lender or bank to a trustee who will hold the property in trust for the lender or bank. In this kind of arrangement, it is the trustee who sells the property being mortgaged and not the bank or the lender. The trustee, in this case, follows instructions from the lender or bank on foreclosure, and the burden of justifying the foreclosure is not on the trustee.

Provided there is no close association between the bank/lender and the trustee, bids for the properties foreclosed are allowed to the bank/lender. Adequate notice is of great importance to all parties that have an interest in the property being mortgaged by the power of sale. The notice can be through a widely publicized local media paper and a notice to you as the mortgagor. 

Affidavits on Foreclosure

The process of foreclosing is tedious and time-consuming, especially if there is a contest of many interested parties. Affidavits in foreclosure cases are used to ease the process and make foreclosure as smooth and as less tedious as possible. The party servicing the mortgage presents an affidavit before the court. These are mainly sworn affidavits where parties affirm the facts regarding the mortgage. Accompanying the affidavit are documents and receipts showing clearly the current mortgage status, the amount paid to date, the amount owed currently, and the default date and by what amount.

In so doing, the servicer aims at convincing the court to order immediate foreclosure without seeking further evidence and save time. If, at this point, you do not challenge the foreclosure based on the affidavit and documents present in court, the court will grant summary judgment to the servicer. The foreclosure process will go on, and your property will be sold without further reference.


Cases do arise where mortgage servicers have enormous volumes of work to process mortgages, and they take shortcuts to quicken the process of foreclosure. The mortgage servicers include affidavits signed without adequate verification, which is a strict requirement for all affidavits. The affidavit obtained in such a manner is referred to as Robo-signing on foreclosure.

You can challenge the authenticity of these affidavits on the basis that the mortgage provider did not verify all the information they contain. Proper documentation to support the affidavit should also be available. In the absence of these supporting documents, you can challenge the affidavit and disapprove of a foreclosure. In case you notice a disagreement in the actual information and the affidavit, you can also challenge the accuracy of the affidavit and have the foreclosure thrown out.

However, it is essential to realize that stopping foreclosure on an affidavit ground is just a temporary relief. Mortgage servicers will still get it organized and be granted foreclosure. But as well, a foreclosure sale date does not have to be the final blow on you. It does not necessarily mean that you become a tenant automatically. Several options that you can exploit do exist, and possibly you can get back your home. Understanding the foreclosure sale and bankruptcy law is vital in helping you make sound decisions. Contact an experienced bankruptcy attorney in Los Angeles to guide you through the process.

Statutory Redemption

Upon the foreclosure sale date, you are given a limited time frame, maybe a year to reclaim your property. You are given this option if you are unable to pay the amount your property sold for at the time of foreclosure. On top of the foreclosure sale price, you are to pay interest to the purchaser at foreclosure that is usually a statutory rate. When you want to recover your property using the statutory redemption process, you begin by writing a demand letter to the purchaser. In the letter, you will request for the charges and the requirements to be paid to regain ownership of your property. 

The person who bought your property has a limited period of around ten days to respond and give a detailed statement of costs to be paid. In California, the state will allow you to possess the property during this redemption period. However, if you abandon the property, the state will reduce the period.   If, after the statement of claim is sent, you fail to pay as per the claim form, then you automatically lose your property. The purchaser, at the time of foreclosure, becomes the legal owner gaining all rights and title to the property. At this point, you have no option but to vacate your home or become a trespasser.  

Voluntary Vacation upon Foreclosure Sale Date

When you fail to meet your mortgage payments, the law allows you to stay in your home until the whole foreclosure process comes to completion. Upon the foreclosure sale date, the property title changes hands legally and you lose ownership of your property. The property purchaser becomes the legal owner of what was your property. Most purchasers are eager to possess the property immediately, but for some, you may come to an agreement and rent the home. However, the law protects you from immediate evacuation, and the new owner will give you a considerable amount of time to vacate the property.

During this vacating notice period, you can opt to vacate voluntarily, wait until the day when evicting sheriff will come to either enforce the eviction order or take advantage of statutory redemption. It is common for new homeowners to seek a smooth vacation to avoid costs and the lengthy vacation process. As such, some new homeowners will pay you money to vacate voluntarily. If you encounter such a situation, it is advisable to take the offer and move out. In doing so, you avoid embarrassing eviction and, at the same time, get some money to look for a new dwelling place.

Forceful Eviction after Foreclosure Sale Date

Failure to make a timely decision upon foreclosure sale date could have adverse effects. In the event you feel that you have nowhere to go, fail to vacate voluntarily, and fail to apply for statutory redemption, you will be forcefully evicted from your premises. This forceful eviction is allowable by the law, and all the new property owner will do is seek a court eviction order. The court will serve you with an eviction notice requiring you to vacate the premises, and you can still do so voluntarily upon receiving the eviction notice. If you get the court eviction notice and still ignore it, no further notice will be given to you, and law enforcement agents will force you out in a couple of days.

Having law enforcement agents evict you from your premises is not an exciting affair. Apart from the fact that it is embarrassing, you also end up ruining your reputation in a significant way that may have lasting implications. Many property owners will wish to establish whether you have ever been forcefully evicted and will go to the extent of checking in public evictions record. Some employers and financing institutions also search for your history in public eviction records making it difficult to get a job or even get financing if your record is terrible. It is advisable for you to move out voluntarily rather than wait for a forceful eviction, which will ruin your credit score and cost you so much.

Landlord and Foreclosure

You may not yet have plans to own your home yet and might be comfortable with leasing at the moment. When you are in such an arrangement with your landlord, the foreclosure sale date might be of little importance to you, and you may not even give it a thought. Yet you are still culpable and might get a notice to leave the premises owing to your landlord's failure to pay your bills. This may happen despite having paid in advance for your lease and having many periods left on the lease. If you find yourself in such a quagmire, it is good to know that the law provides for a 90 days' notice to vacate.

 It is also possible to take legal action against your landlord and have them cater for your relocation costs. Such an occurrence may take you by surprise, and you may not be aware of your options or your next move. With the relevant information concerning tenant/landlord obligations in foreclosure, you can make a sound decision and avoid the heartache. At Los Angeles Bankruptcy Attorney Law Firm, we have experienced professionals well conversant with Bankruptcy laws in California. With an experienced bankruptcy attorney, you will get all the help you need.  

Moving on After the Foreclosure Sale Date

A Foreclosure Sale Date does not mean the end of the world to you. You will still pick up your pieces and move on. The implications of whether you moved out voluntarily or were forcefully evicted will always haunt you and deal a significant blow on your credit rating. Financial institutions will hesitate to advance your credit, and landlords will be skeptical about your consistent rental payment given your past default. However, this should not discourage you; people from across the globe are known to recover from substantial financial setbacks that seem insurmountable.

Frugality at this juncture will be of utmost importance; you will require saving every penny that you possibly can. This will enable you to be able to raise your deposits and win back the confidence of your financiers and future landlords. You may also need to consult a financial advisor to come up with a recovery plan, a debt management plan, and a savings plan. Paying your bills on time and avoiding unnecessary minor debts will also raise your credit rating much faster.  The foreclosure does not last in your records forever; after a period of seven years, the foreclosure will be removed from your files. This will ease the foreclosure burden on you, and with an excellent financial recovery plan, you will bounce back to your feet and regain your financial freedom.

Find a Los Angeles Bankruptcy Attorney near Me

A foreclosure sale date does not have to drive you to the point of anxiety and desperation. Many avenues exist to get back your property and your dignity as well. However, when such a financial handicap beckons, you may think there are no options left. Discussing your obligation with a professional might make all the difference. At Los Angeles Bankruptcy Attorney, we have some of the best Attorneys experienced in handling bankruptcy cases. Contact us at 424-285-5525 and talk to one of our attorneys, and your lawsuit will receive the best consideration.