Mortgage Foreclosure Actions in California

Code of Civil Procedure Part , Title 10, Chapter 1 deals with actions for the foreclosure of mortgages in this state.

Section 725a provides that the beneficiary or trustee named in a deed of trust or mortgagee named in a mortgage with power of sale upon real property or any interest therein to secure a debt or other obligation, has the right to bring suit to foreclose the same in the manner and subject to the provisions, rights and remedies relating to the foreclosure of a mortgage upon such property.

Section 726 states that there can be but one form of action for the recovery of any debt or the enforcement of any right secured by mortgage upon real property or an estate for years therein, which action must be in accordance with the provisions of this chapter. In the action the court may, by its judgment, direct the sale of the encumbered real property or estate for years.

Section 726.5 allows a secured lender to elect between the specified actions where the real property security is environmentally impaired and the borrower’s obligations to the secured lender are in default.

Section 727 says that, if there be surplus money remaining, after payment of the amount due on the mortgage, lien, or incumbrance, with costs, the Court may cause the same to be paid to the person entitled to it, and in the meantime may direct it to be deposited in Court.

Section 728 specifies that, if the debt for which the mortgage, lien, or incumbrance is held is not all due, so soon as sufficient of the property has been sold to pay the amount due, with costs, the sale must cease. Thereafter, as often as more becomes due, for principal or interest, the court may, on motion, order more to be sold.

Section 729.010 provides that, if the decree of foreclosure of a mortgage or deed of trust on real property determines that a deficiency judgment may be ordered against the defendant, the real property (other than a leasehold estate with an unexpired term of less than two years at the time of levy) must be sold subject to the right of redemption.

Section 729.020 says that property sold subject to the right of redemption may be redeemed only by the judgment debtor or the judgment debtor’s successor in interest. For the purpose of this article, the purchaser of the property at the foreclosure sale is not a successor in interest.

Section 729.030 provides that the redemption period during which property may be redeemed from a foreclosure sale under this chapter ends in either three months or one year, depending on specified circumstances.

Section 729.035 specifies that the sale of a separate interest in a common interest development is subject to the right of redemption within 90 days after the sale if the sale arises from a foreclosure by the association of a common interest development.

Section 729.040 states that, when the purchaser of an interest in real property sold subject to the right of redemption pays the amount due, the levying officer conducting the sale must execute and deliver a certificate of sale to the purchaser and record a duplicate of the certificate of sale in the office of the county recorder.

The certificate of sale must contain certain information whether it is a case of judicial foreclosure or nonjudicial foreclosure. The certificate of sale must contain three specified items of information.

Section 729.050 provides that, if property is sold subject to the right of redemption, promptly after the sale the levying officer or trustee who conducted the sale is required to serve notice personally or by mail of the right of redemption on the judgment debtor, including the applicable redemption period.

Section 729.060 requires a person who seeks to redeem the property to deposit the redemption price with the levying officer who conducted the sale before the expiration of the redemption period. If a successor in interest to the judgment debtor seeks to redeem the property, the successor in interest must, at the time the redemption price is deposited, file with the levying officer either of two specified documents. The redemption price is the total of the five specified amounts, less any offset allowed under the law.

Section 729.070 provides that, if the purchaser and the person seeking to redeem the property disagree on the redemption price or as to whether the person is entitled to redeem the property, or if the purchaser refuses the tender of the redemption price, the person seeking to redeem may file a petition with the court for an order determining the redemption price or whether the person is entitled to redeem the property. The petition is required to be in writing and must include three specified statements.

Section 729.080 states that, if the redemption price is not deposited before the expiration of the redemption period, or if no additional deposit is made before the expiration of the time provided, the levying officer who conducted the sale is required to promptly execute and deliver to the purchaser a deed of sale that complies with the requirements of law.

Section 729.090 provides that, from the time of the sale until a redemption, the purchaser is entitled to receive from the person in possession the rents and profits from the property or the value of the use and occupation of the property.

Section 730 requires in all cases of foreclosure of mortgage that the attorney’s fee be fixed by the court in which the proceedings are had, any stipulation in the mortgage to the contrary notwithstanding.