California Foreclosures - New Laws That May Affect You

If you have defaulted on your loan, meaning you have become unable to make timely

payments for whatever reason, you may be facing the possibility of foreclosure. This is when your lender whom you took out your loan with seizes your property in an effort to recover principal on the investment they made when giving you the loan. This takes place if you have fallen behind three or four months on your mortgage payments. Sometimes a homeowner may have unbearable expenses one month but see that they will recover in the coming month. Other times a devastating financial blow means extended inability to make loan payments on your home.

Seeing what you can do now to stop a foreclosure on your California home is better than waiting to see if your financial situation improves. If you cannot recover from your monetary hardships and you home is foreclosed, you must vacate the premises once the house has been either sold at auction or repossessed by the lender, according to the California foreclosure laws. This can be a devastating situation for anyone. As a homeowner facing possible foreclosure in California, there is important information you need to know about concerning the new laws in the state.

Fortunately, if you are facing the possibility of foreclosure, this new law will actually assist you in preventing foreclosure on your home. In June 2009, Ellen Corbett, a Democratic senator from San Leandro, rewrote the California foreclosure law, mandating that lenders in the state must give notice to their borrowers a minimum of 30 days prior to the start of the foreclosure process. Also, if the lender has done nothing to work with the borrower in making affordable changes in agreement terms before sending the notification, a 90-day cessation on payments must occur during the foreclosure process.

The latter portion of this new law has some people arguing that it is not constructive to allow non-mortgage payers to remain in their homes for 3 months without making a payment. Others say it is a perfect addendum to the initial portion of the law, giving homeowners some time to work out a plan to survive the enforced sale. This could include making other living arrangements or working with a lawyer to save their home from foreclosure. No matter what people are saying about the new California foreclosure law, it is a reality and one you should inform yourself about if you are a resident of the state.

by: Troy Truman

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