The key to understanding foreclosure in California is that, while the process is similar between states, each state has its own laws and regulations.

In general understanding foreclosures means that when you miss a payment or two, the bank sends an official notice that you are in the foreclosure process. Then you have a period of time to cure the deficiency. If you cannot do that, the lender pursues foreclosure through either judicial or non-judicial means. Then, there is a sheriff's auction followed by a short redemption period. At that point, the lender owns the house and if you have not already vacated, you can be evicted.

Understanding foreclosure in California means being able to apply these general principles to the specific laws of the state.

The official notice you receive in California is called the Notice of Default. This is filed by a trustee (usually a title company) on the lenders behalf with the County Recorder's Office. A copy must be mailed to the property owner. The Notice of Default must spell out the specific breach of contract.

The Trustee must then notify all interested parties of the foreclosure. These include any co-borrowers as well as other lenders and those with a lien against the property. The Notice of Deficiency must be hand served to the homeowner. If the homeowner cannot be found, the Trustee may get a court order to publish the Notice in a general circulation newspaper.

Now we get to the first variable for understanding foreclosures in California. The time homeowners have to cure the debt varies from state to state. In California this is known as the Reinstatement Waiting Period. The Reinstatement Waiting Period in California is 90 days.

After the three months is up, the Trustee has the obligation to do a final check to see if the deficiency has been cleared. Then a Notice of Sale can be issued. The Notice of Sale must be published once per week for a period of at least 20 days. The Trustee is also obligated to post in a conspicuous place on the property and in at least one off-property place, a sign notifying the public of the upcoming sale.

California is a non-judicial state. That means that the Trustee does not have to go to court and get a court order to sell the house. Rather than have the Sheriff sell the property, as is common in other states, in California the Trustee holds the sale. The sale is an auction. If anyone other than the beneficiary purchases the property, they must have cash in hand to do so.

There is no redemption period in California. Once the sale is final, the foreclosure is final.

And that's your guide to understanding foreclosures in California.

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