Foreclosure FAQs

House at risk of foreclosure

How soon after I miss a payment can the bank foreclose?

In California, for a first mortgage on an owner-occupied property of less than four units, the lender must attempt to contact the borrower to explore options other than foreclosure. As a practical matter most mortgage lenders will not declare the loan in default for one or two missed payments, but will wait until the borrower is more than three months behind before beginning this process.

What kind of notice do they have to give me?

After the thirty-day contact period expires, the lender will send a Notice of Default by certified mail, giving you 90 days to catch up on all missed payments and fees. In California, your mortgage lender does not need to file a lawsuit in court to begin foreclosure proceedings. After the 90 days expires, if you have not made the payments or other arrangements as explained below, the lender may set a trustee sale date within 21 days, again by sending you notice by certified mail.

What can I do to avoid the foreclosure?

If you are unable to make the payments to get current on the loan, you should consider applying for a loan modification. If your application for a loan modification has already been denied see Stop a Trustee Sale.

Can the bank foreclose if I am in the process of applying for a loan modification?

If you are trying to obtain a loan modification, and have submitted a complete application, the mortgage lender must stop the foreclosure process. In other words, lenders are no longer allowed to engage in "Dual Tracking," allowing borrowers to submit loan mod applications while continuing foreclosure proceedings at the same time.

Why is there a foreclosure date set for my home even though I am in a Chapter 13 plan or applying for a loan modification?

Once a trustee sale date is scheduled, it remains a public record available to potential purchasers. However, if your complete loan modification application has been submitted (or if you have the protection of a bankruptcy stay) the trustee sale of your house will not go forward but will be postponed to the next available date. The lender is not required to cancel the trustee sale but is allowed to put it off instead to avoid having to send out a new certified mailing in case your loan modification is denied or your bankruptcy case dismissed.

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