Foreclosure Laws Buy Foreclosures Short Sales Legally

California Trustee’s Sale Procedures

CIVIL CODE
SECTION 2920-2944.5

2920. (a) A mortgage is a contract by which specific property,

including an estate for years in real property, is hypothecated for

the performance of an act, without the necessity of a change of

possession.

  (b) For purposes of Sections 2924 to 2924h, inclusive, "mortgage"

also means any security device or instrument, other than a deed of

trust, that confers a power of sale affecting real property or an

estate for years therein, to be exercised after breach of the

obligation so secured, including a real property sales contract, as

defined in Section 2985, which contains such a provision.

 

 

 

2921. A mortgage may be created upon property held adversely to the

mortgagor.

 

 

 

2922. A mortgage can be created, renewed, or extended, only by

writing, executed with the formalities required in the case of a

grant of real property.

 

 

2923. The lien of a mortgage is special, unless otherwise expressly

agreed, and is independent of possession.

 

 

 

2924. (a) Every transfer of an interest in property, other than in

trust, made only as a security for the performance of another act, is

to be deemed a mortgage, except when in the case of personal

property it is accompanied by actual change of possession, in which

case it is to be deemed a pledge. Where, by a mortgage created after

July 27, 1917, of any estate in real property, other than an estate

at will or for years, less than two, or in any transfer in trust made

after July 27, 1917, of a like estate to secure the performance of

an obligation, a power of sale is conferred upon the mortgagee,

trustee, or any other person, to be exercised after a breach of the

obligation for which that mortgage or transfer is a security, the

power shall not be exercised except where the mortgage or transfer is

made pursuant to an order, judgment, or decree of a court of record,

or to secure the payment of bonds or other evidences of indebtedness

authorized or permitted to be issued by the Commissioner of

Corporations, or is made by a public utility subject to the

provisions of the Public Utilities Act, until all of the following

apply:

  (1) The trustee, mortgagee, or beneficiary, or any of their

authorized agents shall first file for record, in the office of the

recorder of each county wherein the mortgaged or trust property or

some part or parcel thereof is situated, a notice of default. That

notice of default shall include all of the following:

  (A) A statement identifying the mortgage or deed of trust by

stating the name or names of the trustor or trustors and giving the

book and page, or instrument number, if applicable, where the

mortgage or deed of trust is recorded or a description of the

mortgaged or trust property.

  (B) A statement that a breach of the obligation for which the

mortgage or transfer in trust is security has occurred.

  (C) A statement setting forth the nature of each breach actually

known to the beneficiary and of his or her election to sell or cause

to be sold the property to satisfy that obligation and any other

obligation secured by the deed of trust or mortgage that is in

default.

  (D) If the default is curable pursuant to Section 2924c, the

statement specified in paragraph (1) of subdivision (b) of Section

2924c.

  (2) Not less than three months shall elapse from the filing of the

notice of default.

  (3) After the lapse of the three months described in paragraph

(2), the mortgagee, trustee or other person authorized to take the

sale shall give notice of sale, stating the time and place thereof,

in the manner and for a time not less than that set forth in Section

2924f.

  (b) In performing acts required by this article, the trustee shall

incur no liability for any good faith error resulting from reliance

on information provided in good faith by the beneficiary regarding

the nature and the amount of the default under the secured

obligation, deed of trust, or mortgage. In performing the acts

required by this article, a trustee shall not be subject to Title

1.6c (commencing with Section 1788) of Part 4.

  (c) A recital in the deed executed pursuant to the power of sale

of compliance with all requirements of law regarding the mailing of

copies of notices or the publication of a copy of the notice of

default or the personal delivery of the copy of the notice of default

or the posting of copies of the notice of sale or the publication of

a copy thereof shall constitute prima facie evidence of compliance

with these requirements and conclusive evidence thereof in favor of

bona fide purchasers and encumbrancers for value and without notice.

 

  (d) All of the following shall constitute privileged

communications pursuant to Section 47:

  (1) The mailing, publication, and delivery of notices as required

by this section.

  (2) Performance of the procedures set forth in this article.

  (3) Performance of the functions and procedures set forth in this

article if those functions and procedures are necessary to carry out

the duties described in Sections 729.040, 729.050, and 729.080 of the

Code of Civil Procedure.

  (e) There is a rebuttable presumption that the beneficiary

actually knew of all unpaid loan payments on the obligation owed to

the beneficiary and secured by the deed of trust or mortgage subject

to the notice of default. However, the failure to include an

actually known default shall not invalidate the notice of sale and

the beneficiary shall not be precluded from asserting a claim to this

omitted default or defaults in a separate notice of default.

 

 

 

2924.3. (a) Except as provided in subdivisions (b) and (c), a

person who has undertaken as an agent of a mortgagee, beneficiary, or

owner of a promissory note secured directly or collaterally by a

mortgage or deed of trust on real property or an estate for years

therein, to make collections of payments from an obligor under the

note, shall mail the following notices, postage prepaid, to each

mortgagee, beneficiary or owner for whom the agent has agreed to make

collections from the obligor under the note:

  (1) A copy of the notice of default filed in the office of the

county recorder pursuant to Section 2924 on account of a breach of

obligation under the promissory note on which the agent has agreed to

make collections of payments, within 15 days after recordation.

  (2) Notice that a notice of default has been recorded pursuant to

Section 2924 on account of a breach of an obligation secured by a

mortgage or deed of trust against the same property or estate for

years therein having priority over the mortgage or deed of trust

securing the obligation described in paragraph (1), within 15 days

after recordation or within three business days after the agent

receives the information, whichever is later.

  (3) Notice of the time and place scheduled for the sale of the

real property or estate for years therein pursuant to Section 2924f

under a power of sale in a mortgage or deed of trust securing an

obligation described in paragraphs (1) or (2), not less than 15 days

before the scheduled date of the sale or not later than the next

business day after the agent receives the information, whichever is

later.

  (b) An agent who has undertaken to make collections on behalf of

mortgagees, beneficiaries or owners of promissory notes secured by

mortgages or deeds of trust on real property or an estate for years

therein shall not be required to comply with the provisions of

subdivision (a) with respect to a mortgagee, beneficiary or owner who

is entitled to receive notice pursuant to subdivision (c) of Section

2924b or for whom a request for notice has been recorded pursuant to

subdivision (b) of Section 2924b if the agent reasonably believes

that the address of the mortgagee, beneficiary, or owner described in

Section 2924b is the current business or residence address of that

person.

  (c) An agent who has undertaken to make collections on behalf of

mortgagees, beneficiaries or owners of promissory notes secured by

mortgages or deeds of trust on real property or an estate for years

therein shall not be required to comply with the provisions of

paragraph (1) or (2) of subdivision (a) if the agent knows or

reasonably believes that the default has already been cured by or on

behalf of the obligor.

  (d) Any failure to comply with the provisions of this section

shall not affect the validity of a sale in favor of a bona fide

purchaser or the rights of an encumbrancer for value and without

notice.

 

 

2924.5. No clause in any deed of trust or mortgage on property

containing four or fewer residential units or on which four or fewer

residential units are to be constructed or in any obligation secured

by any deed of trust or mortgage on property containing four or fewer

residential units or on which four or fewer residential units are to

be constructed that provides for the acceleration of the due date of

the obligation upon the sale, conveyance, alienation, lease,

succession, assignment or other transfer of the property subject to

the deed of trust or mortgage shall be valid unless the clause is set

forth, in its entirety in both the body of the deed of trust or

mortgage and the promissory note or other document evidencing the

secured obligation. This section shall apply to all such deeds of

trust, mortgages, and obligations secured thereby executed on or

after July 1, 1972.

 

 

 

2924.6. (a) An obligee may not accelerate the maturity date of the

principal and accrued interest on any loan secured by a mortgage or

deed of trust on residential real property solely by reason of any

one or more of the following transfers in the title to the real

property:

  (1) A transfer resulting from the death of an obligor where the

transfer is to the spouse who is also an obligor.

  (2) A transfer by an obligor where the spouse becomes a coowner of

the property.

  (3) A transfer resulting from a decree of dissolution of the

marriage or legal separation or from a property settlement agreement

incidental to such a decree which requires the obligor to continue to

make the loan payments by which a spouse who is an obligor becomes

the sole owner of the property.

  (4) A transfer by an obligor or obligors into an inter vivos trust

in which the obligor or obligors are beneficiaries.

  (5) Such real property or any portion thereof is made subject to a

junior encumbrance or lien.

  (b) Any waiver of the provisions of this section by an obligor is

void and unenforceable and is contrary to public policy.

  (c) For the purposes of this section, "residential real property"

means any real property which contains at least one but not more than

four housing units.

  (d) This act applies only to loans executed or refinanced on or

after January 1, 1976.

 

 

 

2924.7. (a) The provisions of any deed of trust or mortgage on real

property which authorize any beneficiary, trustee, mortgagee, or his

or her agent or successor in interest, to accelerate the maturity

date of the principal and interest on any loan secured thereby or to

exercise any power of sale or other remedy contained therein upon the

failure of the trustor or mortgagor to pay, at the times provided

for under the terms of the deed of trust or mortgage, any taxes,

rents, assessments, or insurance premiums with respect to the

property or the loan, or any advances made by the beneficiary,

mortgagee, or his or her agent or successor in interest shall be

enforceable whether or not impairment of the security interest in the

property has resulted from the failure of the trustor or mortgagor

to pay the taxes, rents, assessments, insurance premiums, or

advances.

  (b) The provisions of any deed of trust or mortgage on real

property which authorize any beneficiary, trustee, mortgagee, or his

or her agent or successor in interest, to receive and control the

disbursement of the proceeds of any policy of fire, flood, or other

hazard insurance respecting the property shall be enforceable whether

or not impairment of the security interest in the property has

resulted from the event that caused the proceeds of the insurance

policy to become payable.

 

 

 

2924a. If, by the terms of any trust or deed of trust a power of

sale is conferred upon the trustee, the attorney for the trustee, or

any duly authorized agent, may conduct the sale and act in the sale

as the auctioneer for the trustee.

 

 

2924b. (a) Any person desiring a copy of any notice of default and

of any notice of sale under any deed of trust or mortgage with power

of sale upon real property or an estate for years therein, as to

which deed of trust or mortgage the power of sale cannot be exercised

until these notices are given for the time and in the manner

provided in Section 2924 may, at any time subsequent to recordation

of the deed of trust or mortgage and prior to recordation of notice

of default thereunder, cause to be filed for record in the office of

the recorder of any county in which any part or parcel of the real

property is situated, a duly acknowledged request for a copy of the

notice of default and of sale. This request shall be signed and

acknowledged by the person making the request, specifying the name

and address of the person to whom the notice is to be mailed, shall

identify the deed of trust or mortgage by stating the names of the

parties thereto, the date of recordation thereof, and the book and

page where the deed of trust or mortgage is recorded or the recorder'

s number, and shall be in substantially the following form:

 

 

 

 "In accordance with Section 2924b, Civil Code,

request is hereby

 

made that a copy of any notice of default and a

copy of any notice of sale

 

under the deed of trust (or mortgage) recorded

______, ____, in Book_____ page ____ records of

____ County, (or filed for record with

 

recorder's serial number ____, _______County)

California, executed

 

by ____ as trustor (or mortgagor) in    which

________ is named as

 

beneficiary (or mortgagee) and ______________ as

trustee be mailed to

 

_________________ at ____________________________.

 

     Name          Address

 

NOTICE: A copy of any notice of default and of

any notice of sale will be

 

sent only to the address contained in this

recorded request. If your address changes, a new

request must be recorded.

 

           Signature _________________"

 

 

  Upon the filing for record of the request, the recorder shall

index in the general index of grantors the names of the trustors (or

mortgagor) recited therein and the names of persons requesting

copies.

  (b) The mortgagee, trustee, or other person authorized to record

the notice of default or the notice of sale shall do each of the

following:

  (1) Within 10 business days following recordation of the notice of

default, deposit or cause to be deposited in the United States mail

an envelope, sent by registered or certified mail with postage

prepaid, containing a copy of the notice with the recording date

shown thereon, addressed to each person whose name and address are

set forth in a duly recorded request therefor, directed to the

address designated in the request and to each trustor or mortgagor at

his or her last known address if different than the address

specified in the deed of trust or mortgage with power of sale.

  (2) At least 20 days before the date of sale, deposit or cause to

be deposited in the United States mail an envelope, sent by

registered or certified mail with postage prepaid, containing a copy

of the notice of the time and place of sale, addressed to each person

whose name and address are set forth in a duly recorded request

therefor, directed to the address designated in the request and to

each trustor or mortgagor at his or her last known address if

different than the address specified in the deed of trust or mortgage

with power of sale.

  (3) As used in paragraphs (1) and (2), the "last known address" of

each trustor or mortgagor means the last business or residence

physical address actually known by the mortgagee, beneficiary,

trustee, or other person authorized to record the notice of default.

For the purposes of this subdivision, an address is "actually known"

if it is contained in the original deed of trust or mortgage, or in

any subsequent written notification of a change of physical address

from the trustor or mortgagor pursuant to the deed of trust or

mortgage. For the purposes of this subdivision, "physical address"

does not include an e-mail or any form of electronic address for a

trustor or mortgagor. The beneficiary shall inform the trustee of the

trustor's last address actually known by the beneficiary. However,

the trustee shall incur no liability for failing to send any notice

to the last address unless the trustee has actual knowledge of it.

  (4) A "person authorized to record the notice of default or the

notice of sale" shall include an agent for the mortgagee or

beneficiary, an agent of the named trustee, any person designated in

an executed substitution of trustee, or an agent of that substituted

trustee.

  (c) The mortgagee, trustee, or other person authorized to record

the notice of default or the notice of sale shall do the following:

  (1) Within one month following recordation of the notice of

default, deposit or cause to be deposited in the United States mail

an envelope, sent by registered or certified mail with postage

prepaid, containing a copy of the notice with the recording date

shown thereon, addressed to each person set forth in paragraph (2),

provided that the estate or interest of any person entitled to

receive notice under this subdivision is acquired by an instrument

sufficient to impart constructive notice of the estate or interest in

the land or portion thereof which is subject to the deed of trust or

mortgage being foreclosed, and provided the instrument is recorded

in the office of the county recorder so as to impart that

constructive notice prior to the recording date of the notice of

default and provided the instrument as so recorded sets forth a

mailing address which the county recorder shall use, as instructed

within the instrument, for the return of the instrument after

recording, and which address shall be the address used for the

purposes of mailing notices herein.

  (2) The persons to whom notice shall be mailed under this

subdivision are:

  (A) The successor in interest, as of the recording date of the

notice of default, of the estate or interest or any portion thereof

of the trustor or mortgagor of the deed of trust or mortgage being

foreclosed.

  (B) The beneficiary or mortgagee of any deed of trust or mortgage

recorded subsequent to the deed of trust or mortgage being

foreclosed, or recorded prior to or concurrently with the deed of

trust or mortgage being foreclosed but subject to a recorded

agreement or a recorded statement of subordination to the deed of

trust or mortgage being foreclosed.

  (C) The assignee of any interest of the beneficiary or mortgagee

described in subparagraph (B), as of the recording date of the notice

of default.

  (D) The vendee of any contract of sale, or the lessee of any

lease, of the estate or interest being foreclosed which is recorded

subsequent to the deed of trust or mortgage being foreclosed, or

recorded prior to or concurrently with the deed of trust or mortgage

being foreclosed but subject to a recorded agreement or statement of

subordination to the deed of trust or mortgage being foreclosed.

  (E) The successor in interest to the vendee or lessee described in

subparagraph (D), as of the recording date of the notice of default.

 

  (F) The office of the Controller, Sacramento, California, where,

as of the recording date of the notice of default, a "Notice of Lien

for Postponed Property Taxes" has been recorded against the real

property to which the notice of default applies.

  (3) At least 20 days before the date of sale, deposit or cause to

be deposited in the United States mail an envelope, sent by

registered or certified mail with postage prepaid, containing a copy

of the notice of the time and place of sale addressed to each person

to whom a copy of the notice of default is to be mailed as provided

in paragraphs (1) and (2), and addressed to the office of any state

taxing agency, Sacramento, California, which has recorded, subsequent

to the deed of trust or mortgage being foreclosed, a notice of tax

lien prior to the recording date of the notice of default against the

real property to which the notice of default applies.

  (4) Provide a copy of the notice of sale to the Internal Revenue

Service, in accordance with Section 7425 of the Internal Revenue Code

and any applicable federal regulation, if a "Notice of Federal Tax

Lien under Internal Revenue Laws" has been recorded, subsequent to

the deed of trust or mortgage being foreclosed, against the real

property to which the notice of sale applies. The failure to provide

the Internal Revenue Service with a copy of the notice of sale

pursuant to this paragraph shall be sufficient cause to rescind the

trustee's sale and invalidate the trustee's deed, at the option of

either the successful bidder at the trustee's sale or the trustee,

and in either case with the consent of the beneficiary. Any option to

rescind the trustee's sale pursuant to this paragraph shall be

exercised prior to any transfer of the property by the successful

bidder to a bona fide purchaser for value. A recision of the trustee'

s sale pursuant to this paragraph may be recorded in a notice of

recision pursuant to Section 1058.5.

  (5) The mailing of notices in the manner set forth in paragraph

(1) shall not impose upon any licensed attorney, agent, or employee

of any person entitled to receive notices as herein set forth any

duty to communicate the notice to the entitled person from the fact

that the mailing address used by the county recorder is the address

of the attorney, agent, or employee.

  (d) Any deed of trust or mortgage with power of sale hereafter

executed upon real property or an estate for years therein may

contain a request that a copy of any notice of default and a copy of

any notice of sale thereunder shall be mailed to any person or party

thereto at the address of the person given therein, and a copy of any

notice of default and of any notice of sale shall be mailed to each

of these at the same time and in the same manner required as though a

separate request therefor had been filed by each of these persons as

herein authorized. If any deed of trust or mortgage with power of

sale executed after September 19, 1939, except a deed of trust or

mortgage of any of the classes excepted from the provisions of

Section 2924, does not contain a mailing address of the trustor or

mortgagor therein named, and if no request for special notice by the

trustor or mortgagor in substantially the form set forth in this

section has subsequently been recorded, a copy of the notice of

default shall be published once a week for at least four weeks in a

newspaper of general circulation in the county in which the property

is situated, the publication to commence within 10 business days

after the filing of the notice of default. In lieu of publication, a

copy of the notice of default may be delivered personally to the

trustor or mortgagor within the 10 business days or at any time

before publication is completed, or by posting the notice of default

in a conspicuous place on the property and mailing the notice to the

last known address of the trustor or mortgagor.

  (e) Any person required to mail a copy of a notice of default or

notice of sale to each trustor or mortgagor pursuant to subdivision

(b) or (c) by registered or certified mail shall simultaneously cause

to be deposited in the United States mail, with postage prepaid and

mailed by first-class mail, an envelope containing an additional copy

of the required notice addressed to each trustor or mortgagor at the

same address to which the notice is sent by registered or certified

mail pursuant to subdivision (b) or (c). The person shall execute and

retain an affidavit identifying the notice mailed, showing the name

and residence or business address of that person, that he or she is

over the age of 18 years, the date of deposit in the mail, the name

and address of the trustor or mortgagor to whom sent, and that the

envelope was sealed and deposited in the mail with postage fully

prepaid. In the absence of fraud, the affidavit required by this

subdivision shall establish a conclusive presumption of mailing.

  (f) No request for a copy of any notice filed for record pursuant

to this section, no statement or allegation in the request, and no

record thereof shall affect the title to real property or be deemed

notice to any person that any person requesting copies of notice has

or claims any right, title, or interest in, or lien or charge upon

the property described in the deed of trust or mortgage referred to

therein.

  (g) "Business day," as used in this section, has the meaning

specified in Section 9.

 

 

 

2924c. (a) (1) Whenever all or a portion of the principal sum of

any obligation secured by deed of trust or mortgage on real property

or an estate for years therein hereafter executed has, prior to the

maturity date fixed in that obligation, become due or been declared

due by reason of default in payment of interest or of any installment

of principal, or by reason of failure of trustor or mortgagor to

pay, in accordance with the terms of that obligation or of the deed

of trust or mortgage, taxes, assessments, premiums for insurance, or

advances made by beneficiary or mortgagee in accordance with the

terms of that obligation or of the deed of trust or mortgage, the

trustor or mortgagor or his or her successor in interest in the

mortgaged or trust property or any part thereof, or any beneficiary

under a subordinate deed of trust or any other person having a

subordinate lien or encumbrance of record thereon, at any time within

the period specified in subdivision (e), if the power of sale

therein is to be exercised, or, otherwise at any time prior to entry

of the decree of foreclosure, may pay to the beneficiary or the

mortgagee or their successors in interest, respectively, the entire

amount due, at the time payment is tendered, with respect to (A) all

amounts of principal, interest, taxes, assessments, insurance

premiums, or advances actually known by the beneficiary to be, and

that are, in default and shown in the notice of default, under the

terms of the deed of trust or mortgage and the obligation secured

thereby, (B) all amounts in default on recurring obligations not

shown in the notice of default, and (C) all reasonable costs and

expenses, subject to subdivision (c), which are actually incurred in

enforcing the terms of the obligation, deed of trust, or mortgage,

and trustee's or attorney's fees, subject to subdivision (d), other

than the portion of principal as would not then be due had no default

occurred, and thereby cure the default theretofore existing, and

thereupon, all proceedings theretofore had or instituted shall be

dismissed or discontinued and the obligation and deed of trust or

mortgage shall be reinstated and shall be and remain in force and

effect, the same as if the acceleration had not occurred. This

section does not apply to bonds or other evidences of indebtedness

authorized or permitted to be issued by the Commissioner of

Corporations or made by a public utility subject to the Public

Utilities Code. For the purposes of this subdivision, the term

"recurring obligation" means all amounts of principal and interest on

the loan, or rents, subject to the deed of trust or mortgage in

default due after the notice of default is recorded; all amounts of

principal and interest or rents advanced on senior liens or

leaseholds which are advanced after the recordation of the notice of

default; and payments of taxes, assessments, and hazard insurance

advanced after recordation of the notice of default. Where the

beneficiary or mortgagee has made no advances on defaults which would

constitute recurring obligations, the beneficiary or mortgagee may

require the trustor or mortgagor to provide reliable written evidence

that the amounts have been paid prior to reinstatement.

  (2) If the trustor, mortgagor, or other person authorized to cure

the default pursuant to this subdivision does cure the default, the

beneficiary or mortgagee or the agent for the beneficiary or

mortgagee shall, within 21 days following the reinstatement, execute

and deliver to the trustee a notice of rescission which rescinds the

declaration of default and demand for sale and advises the trustee of

the date of reinstatement. The trustee shall cause the notice of

rescission to be recorded within 30 days of receipt of the notice of

rescission and of all allowable fees and costs.

  No charge, except for the recording fee, shall be made against the

trustor or mortgagor for the execution and recordation of the notice

which rescinds the declaration of default and demand for sale.

  (b) (1) The notice, of any default described in this section,

recorded pursuant to Section 2924, and mailed to any person pursuant

to Section 2924b, shall begin with the following statement, printed

or typed thereon:

   "IMPORTANT NOTICE (14-point boldface type if printed or in

capital letters if typed)

 

  IF YOUR PROPERTY IS IN FORECLOSURE BECAUSE YOU ARE BEHIND IN YOUR

PAYMENTS, IT MAY BE SOLD WITHOUT ANY COURT ACTION, (14-point boldface

type if printed or in capital letters if typed) and you may have the

legal right to bring your account in good standing by paying all of

your past due payments plus permitted costs and expenses within the

time permitted by law for reinstatement of your account, which is

normally five business days prior to the date set for the sale of

your property. No sale date may be set until three months from the

date this notice of default may be recorded (which date of

recordation appears on this notice).

 

 

 This amount is ___________________ as of ______________________

                          (Date)

and will increase until your account becomes current.

 

  While your property is in foreclosure, you still must pay other

obligations (such as insurance and taxes) required by your note and

deed of trust or mortgage. If you fail to make future payments on

the loan, pay taxes on the property, provide insurance on the

property, or pay other obligations as required in the note and deed

of trust or mortgage, the beneficiary or mortgagee may insist that

you do so in order to reinstate your account in good standing. In

addition, the beneficiary or mortgagee may require as a condition to

reinstatement that you provide reliable written evidence that you

paid all senior liens, property taxes, and hazard insurance premiums.

 

  Upon your written request, the beneficiary or mortgagee will give

you a written itemization of the entire amount you must pay. You may

not have to pay the entire unpaid portion of your account, even

though full payment was demanded, but you must pay all amounts in

default at the time payment is made. However, you and your

beneficiary or mortgagee may mutually agree in writing prior to the

time the notice of sale is posted (which may not be earlier than the

end of the three-month period stated above) to, among other things,

(1) provide additional time in which to cure the default by transfer

of the property or otherwise; or (2) establish a schedule of payments

in order to cure your default; or both (1) and (2).

  Following the expiration of the time period referred to in the

first paragraph of this notice, unless the obligation being

foreclosed upon or a separate written agreement between you and your

creditor permits a longer period, you have only the legal right to

stop the sale of your property by paying the entire amount demanded

by your creditor.

  To find out the amount you must pay, or to arrange for payment to

stop the foreclosure, or if your property is in foreclosure for any

other reason, contact:

 

 

             ______________________________________

              (Name of beneficiary or mortgagee)

 

             ______________________________________

                   (Mailing address)

 

             ______________________________________

                    (Telephone)

 

  If you have any questions, you should contact a lawyer or the

governmental agency which may have insured your loan.

  Notwithstanding the fact that your property is in foreclosure, you

may offer your property for sale, provided the sale is concluded

prior to the conclusion of the foreclosure.

  Remember, YOU MAY LOSE LEGAL RIGHTS IF YOU DO NOT TAKE PROMPT

ACTION. (14-point boldface type if printed or in capital letters if

typed)"

 

  Unless otherwise specified, the notice, if printed, shall appear

in at least 12-point boldface type.

  If the obligation secured by the deed of trust or mortgage is a

contract or agreement described in paragraph (1) or (4) of

subdivision (a) of Section 1632, the notice required herein shall be

in Spanish if the trustor requested a Spanish language translation of

the contract or agreement pursuant to Section 1632. If the

obligation secured by the deed of trust or mortgage is contained in a

home improvement contract, as defined in Sections 7151.2 and 7159 of

the Business and Professions Code, which is subject to Title 2

(commencing with Section 1801), the seller shall specify on the

contract whether or not the contract was principally negotiated in

Spanish and if the contract was principally negotiated in Spanish,

the notice required herein shall be in Spanish. No assignee of the

contract or person authorized to record the notice of default shall

incur any obligation or liability for failing to mail a notice in

Spanish unless Spanish is specified in the contract or the assignee

or person has actual knowledge that the secured obligation was

principally negotiated in Spanish. Unless specified in writing to

the contrary, a copy of the notice required by subdivision (c) of

Section 2924b shall be in English.

  (2) Any failure to comply with the provisions of this subdivision

shall not affect the validity of a sale in favor of a bona fide

purchaser or the rights of an encumbrancer for value and without

notice.

  (c) Costs and expenses which may be charged pursuant to Sections

2924 to 2924i, inclusive, shall be limited to the costs incurred for

recording, mailing, including certified and express mail charges,

publishing, and posting notices required by Sections 2924 to 2924i,

inclusive, postponement pursuant to Section 2924g not to exceed fifty

dollars ($50) per postponement and a fee for a trustee's sale

guarantee or, in the event of judicial foreclosure, a litigation

guarantee. For purposes of this subdivision, a trustee or

beneficiary may purchase a trustee's sale guarantee at a rate meeting

the standards contained in Sections 12401.1 and 12401.3 of the

Insurance Code.

  (d) Trustee's or attorney's fees which may be charged pursuant to

subdivision (a), or until the notice of sale is deposited in the mail

to the trustor as provided in Section 2924b, if the sale is by power

of sale contained in the deed of trust or mortgage, or, otherwise at

any time prior to the decree of foreclosure, are hereby authorized

to be in a base amount that does not exceed three hundred dollars

($300) if the unpaid principal sum secured is one hundred fifty

thousand dollars ($150,000) or less, or two hundred fifty dollars

($250) if the unpaid principal sum secured exceeds one hundred fifty

thousand dollars ($150,000), plus one-half of 1 percent of the unpaid

principal sum secured exceeding fifty thousand dollars ($50,000) up

to and including one hundred fifty thousand dollars ($150,000), plus

one-quarter of 1 percent of any portion of the unpaid principal sum

secured exceeding one hundred fifty thousand dollars ($150,000) up to

and including five hundred thousand dollars ($500,000), plus

one-eighth of 1 percent of any portion of the unpaid principal sum

secured exceeding five hundred thousand dollars ($500,000). Any

charge for trustee's or attorney's fees authorized by this

subdivision shall be conclusively presumed to be lawful and valid

where the charge does not exceed the amounts authorized herein. For

purposes of this subdivision, the unpaid principal sum secured shall

be determined as of the date the notice of default is recorded.

  (e) Reinstatement of a monetary default under the terms of an

obligation secured by a deed of trust, or mortgage may be made at any

time within the period commencing with the date of recordation of

the notice of default until five business days prior to the date of

sale set forth in the initial recorded notice of sale.

  In the event the sale does not take place on the date set forth in

the initial recorded notice of sale or a subsequent recorded notice

of sale is required to be given, the right of reinstatement shall be

revived as of the date of recordation of the subsequent notice of

sale, and shall continue from that date until five business days

prior to the date of sale set forth in the subsequently recorded

notice of sale.

  In the event the date of sale is postponed on the date of sale set

forth in either an initial or any subsequent notice of sale, or is

postponed on the date declared for sale at an immediately preceding

postponement of sale, and, the postponement is for a period which

exceeds five business days from the date set forth in the notice of

sale, or declared at the time of postponement, then the right of

reinstatement is revived as of the date of postponement and shall

continue from that date until five business days prior to the date of

sale declared at the time of the postponement.

  Nothing contained herein shall give rise to a right of

reinstatement during the period of five business days prior to the

date of sale, whether the date of sale is noticed in a notice of sale

or declared at a postponement of sale.

  Pursuant to the terms of this subdivision, no beneficiary,

trustee, mortgagee, or their agents or successors shall be liable in

any manner to a trustor, mortgagor, their agents or successors or any

beneficiary under a subordinate deed of trust or mortgage or any

other person having a subordinate lien or encumbrance of record

thereon for the failure to allow a reinstatement of the obligation

secured by a deed of trust or mortgage during the period of five

business days prior to the sale of the security property, and no such

right of reinstatement during this period is created by this

section. Any right of reinstatement created by this section is

terminated five business days prior to the date of sale set forth in

the initial date of sale, and is revived only as prescribed herein

and only as of the date set forth herein.

  As used in this subdivision, the term "business day" has the same

meaning as specified in Section 9.

 

 

2924d. (a) Commencing with the date that the notice of sale is

deposited in the mail, as provided in Section 2924b, and until the

property is sold pursuant to the power of sale contained in the

mortgage or deed of trust, a beneficiary, trustee, mortgagee, or his

or her agent or successor in interest, may demand and receive from a

trustor, mortgagor, or his or her agent or successor in interest, or

any beneficiary under a subordinate deed of trust, or any other

person having a subordinate lien or encumbrance of record those

reasonable costs and expenses, to the extent allowed by subdivision

(c) of Section 2924c, which are actually incurred in enforcing the

terms of the obligation and trustee's or attorney's fees which are

hereby authorized to be in a base amount which does not exceed four

hundred twenty-five dollars ($425) if the unpaid principal sum

secured is one hundred fifty thousand dollars ($150,000) or less, or

three hundred sixty dollars ($360) if the unpaid principal sum

secured exceeds one hundred fifty thousand dollars ($150,000), plus 1

percent of any portion of the unpaid principal sum secured exceeding

fifty thousand dollars ($50,000) up to and including one hundred

fifty thousand dollars ($150,000), plus one-half of 1 percent of any

portion of the unpaid principal sum secured exceeding one hundred

fifty thousand dollars ($150,000) up to and including five hundred

thousand dollars ($500,000), plus one-quarter of 1 percent of any

portion of the unpaid principal sum secured exceeding five hundred

thousand dollars ($500,000). For purposes of this subdivision, the

unpaid principal sum secured shall be determined as of the date the

notice of default is recorded. Any charge for trustee's or attorney'

s fees authorized by this subdivision shall be conclusively presumed

to be lawful and valid where that charge does not exceed the amounts

authorized herein. Any charge for trustee's or attorney's fees made

pursuant to this subdivision shall be in lieu of and not in addition

to those charges authorized by subdivision (d) of Section 2924c.

  (b) Upon the sale of property pursuant to a power of sale, a

trustee, or his or her agent or successor in interest, may demand and

receive from a beneficiary, or his or her agent or successor in

interest, or may deduct from the proceeds of the sale, those

reasonable costs and expenses, to the extent allowed by subdivision

(c) of Section 2924c, which are actually incurred in enforcing the

terms of the obligation and trustee's or attorney's fees which are

hereby authorized to be in an amount which does not exceed four

hundred twenty-five dollars ($425) or one percent of the unpaid

principal sum secured, whichever is greater. For purposes of this

subdivision, the unpaid principal sum secured shall be determined as

of the date the notice of default is recorded. Any charge for

trustee's or attorney's fees authorized by this subdivision shall be

conclusively presumed to be lawful and valid where that charge does

not exceed the amount authorized herein. Any charges for trustee's

or attorney's fees made pursuant to this subdivision shall be in lieu

of and not in addition to those charges authorized by subdivision

(a) of this section and subdivision (d) of Section 2924c.

  (c) (1) No person shall pay or offer to pay or collect any rebate

or kickback for the referral of business involving the performance of

any act required by this article.

  (2) Any person who violates this subdivision shall be liable to

the trustor for three times the amount of any rebate or kickback,

plus reasonable attorney's fees and costs, in addition to any other

remedies provided by law.

  (3) No violation of this subdivision shall affect the validity of

a sale in favor of a bona fide purchaser or the rights of an

encumbrancer for value without notice.

  (d) It shall not be unlawful for a trustee to pay or offer to pay

a fee to an agent or subagent of the trustee for work performed by

the agent or subagent in discharging the trustee's obligations under

the terms of the deed of trust. Any payment of a fee by a trustee to

an agent or subagent of the trustee for work performed by the agent

or subagent in discharging the trustee's obligations under the terms

of the deed of trust shall be conclusively presumed to be lawful and

valid if the fee, when combined with other fees of the trustee, does

not exceed in the aggregate the trustee's fee authorized by

subdivision (d) of Section 2924c or subdivision (a) or (b) of this

section.

  (e) When a court issues a decree of foreclosure, it shall have

discretion to award attorney's fees, costs, and expenses as are

reasonable, if provided for in the note, deed of trust, or mortgage,

pursuant to Section 580c of the Code of Civil Procedure.

 

 

 

2924e. (a) The beneficiary or mortgagee of any deed of trust or

mortgage on real property either containing one to four residential

units or given to secure an original obligation not to exceed three

hundred thousand dollars ($300,000) may, with the written consent of

the trustor or mortgagor that is either effected through a signed and

dated agreement which shall be separate from other loan and security

documents or disclosed to the trustor or mortgagor in at least

10-point type, submit a written request by certified mail to the

beneficiary or mortgagee of any lien which is senior to the lien of

the requester, for written notice of any or all delinquencies of four

months or more, in payments of principal or interest on any

obligation secured by that senior lien notwithstanding that the loan

secured by the lien of the requester is not then in default as to

payments of principal or interest.

  The request shall be sent to the beneficiary or mortgagee, or

agent which it might designate for the purpose of receiving loan

payments, at the address specified for the receipt of these payments,

if known, or, if not known, at the address shown on the recorded

deed of trust or mortgage.

  (b) The request for notice shall identify the ownership or

security interest of the requester, the date on which the interest of

the requester will terminate as evidenced by the maturity date of

the note of the trustor or mortgagor in favor of the requester, the

name of the trustor or mortgagor and the name of the current owner of

the security property if different from the trustor or mortgagor,

the street address or other description of the security property, the

loan number (if available to the requester) of the loan secured by

the senior lien, the name and address to which notice is to be sent,

and shall include or be accompanied by the signed written consent of

the trustor or mortgagor, and a fee of forty dollars ($40). For

obligations secured by residential properties, the request shall

remain valid until withdrawn in writing and shall be applicable to

all delinquencies as provided in this section, which occur prior to

the date on which the interest of the requester will terminate as

specified in the request or the expiration date, as appropriate. For

obligations secured by nonresidential properties, the request shall

remain valid until withdrawn in writing and shall be applicable to

all delinquencies as provided in this section, which occur prior to

the date on which the interest of the requester will terminate as

specified in the request or the expiration date, as appropriate. The

beneficiary or mortgagee of obligations secured by nonresidential

properties that have sent five or more notices prior to the

expiration of the effective period of the request may charge a fee up

to fifteen dollars ($15) for each subsequent notice. A request for

notice shall be effective for five years from the mailing of the

request or the recording of that request, whichever occurs later, and

may be renewed within six months prior to its expiration date by

sending the beneficiary or mortgagee, or agent, as the case may be,

at the address to which original requests for notice are to be sent,

a copy of the earlier request for notice together with a signed

statement that the request is renewed and a renewal fee of fifteen

dollars ($15). Upon timely submittal of a renewal request for

notice, the effectiveness of the original request is continued for

five years from the time when it would otherwise have lapsed.

Succeeding renewal requests may be submitted in the same manner. The

request for notice and renewals thereof shall be recorded in the

office of the county recorder of the county in which the security

real property is situated. The rights and obligations specified in

this section shall inure to the benefit of, or pass to, as the case

may be, successors in interest of parties specified in this section.

Any successor in interest of a party entitled to notice under this

section shall file a request for that notice with any beneficiary or

mortgagee of the senior lien and shall pay a processing fee of

fifteen dollars ($15). No new written consent shall be required from

the trustor or mortgagor.

  (c) Unless the delinquency has been cured, within 15 days

following the end of four months from any delinquency in payments of

principal or interest on any obligation secured by the senior lien

which delinquency exists or occurs on or after 10 days from the

mailing of the request for notice or the recording of that request,

whichever occurs later, the beneficiary or mortgagee shall give

written notice to the requester of the fact of any delinquency and

the amount thereof.

  The notice shall be given by personal service, or by deposit in

the mail, first-class postage paid. Following the recording of any

notice of default pursuant to Section 2924 with respect to the same

delinquency, no notice or further notice shall be required pursuant

to this section.

  (d) If the beneficiary or mortgagee of any such senior lien fails

to give notice to the requester as required in subdivision (c), and a

subsequent foreclosure or trustee's sale of the security property

occurs, the beneficiary or mortgagee shall be liable to the requester

for any monetary damage due to the failure to provide notice within

the time period specified in subdivision (c) which the requester has

sustained from the date on which notice should have been given to the

earlier of the date on which the notice is given or the date of the

recording of the notice of default under Section 2924, and shall also

forfeit to the requester the sum of three hundred dollars ($300). A

showing by the beneficiary or mortgagee by a preponderance of the

evidence that the failure to provide timely notice as required by

subdivision (c) resulted from a bona fide error notwithstanding the

maintenance of procedures reasonably adapted to avoid any such error

shall be a defense to any liability for that failure.

  (e) If any beneficiary or mortgagee, or agent which it had

designated for the purpose of receiving loan payments, has been

succeeded in interest by any other person, any request for notice

received pursuant to this section shall be transmitted promptly to

that person.

  (f) Any failure to comply with the provisions of this section

shall not affect the validity of a sale in favor of a bona fide

purchaser or the rights of an encumbrancer for value and without

notice.

  (g) Upon satisfaction of an obligation secured by a junior lien

with respect to which a notice request was made pursuant to this

section, the beneficiary or mortgagee that made the request shall

communicate that fact in writing to the senior lienholder to whom the

request was made. The communication shall specify that provision of

notice pursuant to the prior request under this section is no longer

required.

 

 

2924f. (a) As used in this section and Sections 2924g and 2924h,

"property" means real property or a leasehold estate therein, and

"calendar week" means Monday through Saturday, inclusive.

  (b) (1) Except as provided in subdivision (c), before any sale of

property can be made under the power of sale contained in any deed of

trust or mortgage, or any resale resulting from a rescission for a

failure of consideration pursuant to subdivision (c) of Section

2924h, notice of the sale thereof shall be given by posting a written

notice of the time of sale and of the street address and the

specific place at the street address where the sale will be held, and

describing the property to be sold, at least 20 days before the date

of sale in one public place in the city where the property is to be

sold, if the property is to be sold in a city, or, if not, then in

one public place in the judicial district in which the property is to

be sold, and publishing a copy once a week for three consecutive

calendar weeks, the first publication to be at least 20 days before

the date of sale, in a newspaper of general circulation published in

the city in which the property or some part thereof is situated, if

any part thereof is situated in a city, if not, then in a newspaper

of general circulation published in the judicial district in which

the property or some part thereof is situated, or in case no

newspaper of general circulation is published in the city or judicial

district, as the case may be, in a newspaper of general circulation

published in the county in which the property or some part thereof is

situated, or in case no newspaper of general circulation is

published in the city or judicial district or county, as the case may

be, in a newspaper of general circulation published in the county in

this state that (A) is contiguous to the county in which the

property or some part thereof is situated and (B) has, by comparison

with all similarly contiguous counties, the highest population based

upon total county population as determined by the most recent federal

decennial census published by the Bureau of the Census. A copy of

the notice of sale shall also be posted in a conspicuous place on the

property to be sold at least 20 days before the date of sale, where

possible and where not restricted for any reason. If the property is

a single-family residence the posting shall be on a door of the

residence, but, if not possible or restricted, then the notice shall

be posted in a conspicuous place on the property; however, if access

is denied because a common entrance to the property is restricted by

a guard gate or similar impediment, the property may be posted at

that guard gate or similar impediment to any development community.

Additionally, the notice of sale shall conform to the minimum

requirements of Section 6043 of the Government Code and be recorded

with the county recorder of the county in which the property or some

part thereof is situated at least 14 days prior to the date of sale.

The notice of sale shall contain the name, street address in this

state, which may reflect an agent of the trustee, and either a

toll-free telephone number or telephone number in this state of the

trustee, and the name of the original trustor, and also shall contain

the statement required by paragraph (3) of subdivision (c). In

addition to any other description of the property, the notice shall

describe the property by giving its street address, if any, or other

common designation, if any, and a county assessor's parcel number;

but if the property has no street address or other common

designation, the notice shall contain a legal description of the

property, the name and address of the beneficiary at whose request

the sale is to be conducted, and a statement that directions may be

obtained pursuant to a written request submitted to the beneficiary

within 10 days from the first publication of the notice. Directions

shall be deemed reasonably sufficient to locate the property if

information as to the location of the property is given by reference

to the direction and approximate distance from the nearest

crossroads, frontage road, or access road. If a legal description or

a county assessor's parcel number and either a street address or

another common designation of the property is given, the validity of

the notice and the validity of the sale shall not be affected by the

fact that the street address, other common designation, name and

address of the beneficiary, or the directions obtained therefrom are

erroneous or that the street address, other common designation, name

and address of the beneficiary, or directions obtained therefrom are

omitted. The term "newspaper of general circulation," as used in

this section, has the same meaning as defined in Article 1

(commencing with Section 6000) of Chapter 1 of Division 7 of Title 1

of the Government Code.

  The notice of sale shall contain a statement of the total amount

of the unpaid balance of the obligation secured by the property to be

sold and reasonably estimated costs, expenses, advances at the time

of the initial publication of the notice of sale, and, if republished

pursuant to a cancellation of a cash equivalent pursuant to

subdivision (d) of Section 2924h, a reference of that fact; provided,

that the trustee shall incur no liability for any good faith error

in stating the proper amount, including any amount provided in good

faith by or on behalf of the beneficiary. An inaccurate statement of

this amount shall not affect the validity of any sale to a bona fide

purchaser for value, nor shall the failure to post the notice of

sale on a door as provided by this subdivision affect the validity of

any sale to a bona fide purchaser for value.

  (2) If the sale of the property is to be a unified sale as

provided in subparagraph (B) of paragraph (1) of subdivision (a) of

Section 9604 of the Commercial Code, the notice of sale shall also

contain a description of the personal property or fixtures to be

sold. In the case where it is contemplated that all of the personal

property or fixtures are to be sold, the description in the notice of

the personal property or fixtures shall be sufficient if it is the

same as the description of the personal property or fixtures

contained in the agreement creating the security interest in or

encumbrance on the personal property or fixtures or the filed

financing statement relating to the personal property or fixtures.

In all other cases, the description in the notice shall be sufficient

if it would be a sufficient description of the personal property or

fixtures under Section 9108 of the Commercial Code. Inclusion of a

reference to or a description of personal property or fixtures in a

notice of sale hereunder shall not constitute an election by the

secured party to conduct a unified sale pursuant to subparagraph (B)

of paragraph (1) of subdivision (a) of Section 9604 of the Commercial

Code, shall not obligate the secured party to conduct a unified sale

pursuant to subparagraph (B) of paragraph (1) of subdivision (a) of

Section 9604 of the Commercial Code, and in no way shall render

defective or noncomplying either that notice or a sale pursuant to

that notice by reason of the fact that the sale includes none or less

than all of the personal property or fixtures referred to or

described in the notice. This paragraph shall not otherwise affect

the obligations or duties of a secured party under the Commercial

Code.

  (c) (1) This subdivision applies only to deeds of trust or

mortgages which contain a power of sale and which are secured by real

property containing a single-family, owner-occupied residence, where

the obligation secured by the deed of trust or mortgage is contained

in a contract for goods or services subject to the provisions of the

Unruh Act (Chapter 1 (commencing with Section 1801) of Title 2 of

Part 4 of Division 3).

  (2) Except as otherwise expressly set forth in this subdivision,

all other provisions of law relating to the exercise of a power of

sale shall govern the exercise of a power of sale contained in a deed

of trust or mortgage described in paragraph (1).

  (3) If any default of the obligation secured by a deed of trust or

mortgage described in paragraph (1) has not been cured within 30

days after the recordation of the notice of default, the trustee or

mortgagee shall mail to the trustor or mortgagor, at his or her last

known address, a copy of the following statement:

 

 

YOU ARE IN DEFAULT UNDER A

___________________________________________________,

      Deed of trust or mortgage

DATED ______. UNLESS YOU TAKE ACTION TO PROTECT

YOUR PROPERTY, IT MAY BE SOLD AT A PUBLIC SALE.

IF YOU NEED AN EXPLANATION OF THE NATURE OF THE

PROCEEDING AGAINST YOU, YOU SHOULD CONTACT A LAWYER.

 

  (4) All sales of real property pursuant to a power of sale

contained in any deed of trust or mortgage described in paragraph (1)

shall be held in the county where the residence is located and shall

be made to the person making the highest offer. The trustee may

receive offers during the 10-day period immediately prior to the date

of sale and if any offer is accepted in writing by both the trustor

or mortgagor and the beneficiary or mortgagee prior to the time set

for sale, the sale shall be postponed to a date certain and prior to

which the property may be conveyed by the trustor to the person

making the offer according to its terms. The offer is revocable

until accepted. The performance of the offer, following acceptance,

according to its terms, by a conveyance of the property to the

offeror, shall operate to terminate any further proceeding under the

notice of sale and it shall be deemed revoked.

  (5) In addition to the trustee fee pursuant to Section 2924c, the

trustee or mortgagee pursuant to a deed of trust or mortgage subject

to this subdivision shall be entitled to charge an additional fee of

fifty dollars ($50).

  (6) This subdivision applies only to property on which notices of

default were filed on or after the effective date of this

subdivision.

 

 

 

2924g. (a) All sales of property under the power of sale contained

in any deed of trust or mortgage shall be held in the county where

the property or some part thereof is situated, and shall be made at

auction, to the highest bidder, between the hours of 9 a.m. and 5

p.m. on any business day, Monday through Friday.

  The sale shall commence at the time and location specified in the

notice of sale. Any postponement shall be announced at the time and

location specified in the notice of sale for commencement of the sale

or pursuant to paragraph (1) of subdivision (c).

  If the sale of more than one parcel of real property has been

scheduled for the same time and location by the same trustee, (1) any

postponement of any of the sales shall be announced at the time

published in the notice of sale, (2) the first sale shall commence at

the time published in the notice of sale or immediately after the

announcement of any postponement, and (3) each subsequent sale shall

take place as soon as possible after the preceding sale has been

completed.

  (b) When the property consists of several known lots or parcels,

they shall be sold separately unless the deed of trust or mortgage

provides otherwise. When a portion of the property is claimed by a

third person, who requires it to be sold separately, the portion

subject to the claim may be thus sold. The trustor, if present at the

sale, may also, unless the deed of trust or mortgage otherwise

provides, direct the order in which property shall be sold, when the

property consists of several known lots or parcels which may be sold

to advantage separately, and the trustee shall follow that direction.

After sufficient property has been sold to satisfy the indebtedness,

no more can be sold.

  If the property under power of sale is in two or more counties,

the public auction sale of all of the property under the power of

sale may take place in any one of the counties where the property or

a portion thereof is located.

  (c) (1) There may be a postponement or postponements of the sale

proceedings, including a postponement upon instruction by the

beneficiary to the trustee that the sale proceedings be postponed, at

any time prior to the completion of the sale for any period of time

not to exceed a total of 365 days from the date set forth in the

notice of sale. The trustee shall postpone the sale in accordance

with any of the following:

  (A) Upon the order of any court of competent jurisdiction.

  (B) If stayed by operation of law.

  (C) By mutual agreement, whether oral or in writing, of any

trustor and any beneficiary or any mortgagor and any mortgagee.

  (D) At the discretion of the trustee.

  (2) In the event that the sale proceedings are postponed for a

period or periods totaling more than 365 days, the scheduling of any

further sale proceedings shall be preceded by giving a new notice of

sale in the manner prescribed in Section 2924f. New fees incurred for

the new notice of sale shall not exceed the amounts specified in

Sections 2924c and 2924d, and shall not exceed reasonable costs that

are necessary to comply with this paragraph.

  (d) The notice of each postponement and the reason therefor shall

be given by public declaration by the trustee at the time and place

last appointed for sale. A public declaration of postponement shall

also set forth the new date, time, and place of sale and the place of

sale shall be the same place as originally fixed by the trustee for

the sale. No other notice of postponement need be given. However,

the sale shall be conducted no sooner than on the seventh day after

the earlier of (1) dismissal of the action or (2) expiration or

termination of the injunction, restraining order, or stay that

required postponement of the sale, whether by entry of an order by a

court of competent jurisdiction, operation of law, or otherwise,

unless the injunction, restraining order, or subsequent order

expressly directs the conduct of the sale within that seven-day

period. For purposes of this subdivision, the seven-day period shall

not include the day on which the action is dismissed, or the day on

which the injunction, restraining order, or stay expires or is

terminated. If the sale had been scheduled to occur, but this

subdivision precludes its conduct during that seven-day period, a new

notice of postponement shall be given if the sale had been scheduled

to occur during that seven-day period. The trustee shall maintain

records of each postponement and the reason therefor.

  (e) Notwithstanding the time periods established under subdivision

(d), if postponement of a sale is based on a stay imposed by Title

11 of the United States Code (bankruptcy), the sale shall be

conducted no sooner than the expiration of the stay imposed by that

title and the seven-day provision of subdivision (d) shall not apply.

 

 

 

2924h. (a) Each and every bid made by a bidder at a trustee's sale

under a power of sale contained in a deed of trust or mortgage shall

be deemed to be an irrevocable offer by that bidder to purchase the

property being sold by the trustee under the power of sale for the

amount of the bid. Any second or subsequent bid by the same bidder

or any other bidder for a higher amount shall be a cancellation of

the prior bid.

  (b) At the trustee's sale the trustee shall have the right (1) to

require every bidder to show evidence of the bidder's ability to

deposit with the trustee the full amount of his or her final bid in

cash, a cashier's check drawn on a state or national bank, a check

drawn by a state or federal credit union, or a check drawn by a state

or federal savings and loan association, savings association, or

savings bank specified in Section 5102 of the Financial Code and

authorized to do business in this state, or a cash equivalent which

has been designated in the notice of sale as acceptable to the

trustee prior to, and as a condition to, the recognizing of the bid,

and to conditionally accept and hold these amounts for the duration

of the sale, and (2) to require the last and highest bidder to

deposit, if not deposited previously, the full amount of the bidder's

final bid in cash, a cashier's check drawn on a state or national

bank, a check drawn by a state or federal credit union, or a check

drawn by a state or federal savings and loan association, savings

association, or savings bank specified in Section 5102 of the

Financial Code and authorized to do business in this state, or a cash

equivalent which has been designated in the notice of sale as

acceptable to the trustee, immediately prior to the completion of the

sale, the completion of the sale being so announced by the fall of

the hammer or in another customary manner. The present beneficiary

of the deed of trust under foreclosure shall have the right to offset

his or her bid or bids only to the extent of the total amount due

the beneficiary including the trustee's fees and expenses.

  (c) In the event the trustee accepts a check drawn by a credit

union or a savings and loan association pursuant to this subdivision

or a cash equivalent designated in the notice of sale, the trustee

may withhold the issuance of the trustee's deed to the successful

bidder submitting the check drawn by a state or federal credit union

or savings and loan association or the cash equivalent until funds

become available to the payee or endorsee as a matter of right.

  For the purposes of this subdivision, the trustee's sale shall be

deemed final upon the acceptance of the last and highest bid, and

shall be deemed perfected as of 8 a.m. on the actual date of sale if

the trustee's deed is recorded within 15 calendar days after the

sale, or the next business day following the 15th day if the county

recorder in which the property is located is closed on the 15th day.

However, the sale is subject to an automatic rescission for a

failure of consideration in the event the funds are not "available

for withdrawal" as defined in Section 12413.1 of the Insurance Code.

The trustee shall send a notice of rescission for a failure of

consideration to the last and highest bidder submitting the check or

alternative instrument, if the address of the last and highest bidder

is known to the trustee.

  If a sale results in an automatic right of rescission for failure

of consideration pursuant to this subdivision, the interest of any

lienholder shall be reinstated in the same priority as if the

previous sale had not occurred.

  (d) If the trustee has not required the last and highest bidder to

deposit the cash, a cashier's check drawn on a state or national

bank, a check drawn by a state or federal credit union, or a check

drawn by a state or federal savings and loan association, savings

association, or savings bank specified in Section 5102 of the

Financial Code and authorized to do business in this state, or a cash

equivalent which has been designated in the notice of sale as

acceptable to the trustee in the manner set forth in paragraph (2) of

subdivision (b), the trustee shall complete the sale. If the last

and highest bidder then fails to deliver to the trustee, when

demanded, the amount of his or her final bid in cash, a cashier's

check drawn on a state or national bank, a check drawn by a state or

federal credit union, or a check drawn by a state or federal savings

and loan association, savings association, or savings bank specified

in Section 5102 of the Financial Code and authorized to do business

in this state, or a cash equivalent which has been designated in the

notice of sale as acceptable to the trustee, that bidder shall be

liable to the trustee for all damages which the trustee may sustain

by the refusal to deliver to the trustee the amount of the final bid,

including any court costs and reasonable attorneys' fees.

  If the last and highest bidder willfully fails to deliver to the

trustee the amount of his or her final bid in cash, a cashier's check

drawn on a state or national bank, a check drawn by a state or

federal credit union, or a check drawn by a state or federal savings

and loan association, savings association, or savings bank specified

in Section 5102 of the Financial Code and authorized to do business

in this state, or a cash equivalent which has been designated in the

notice of sale as acceptable to the trustee, or if the last and

highest bidder cancels a cashiers check drawn on a state or national

bank, a check drawn by a state or federal credit union, or a check

drawn by a state or federal savings and loan association, savings

association, or savings bank specified in Section 5102 of the

Financial Code and authorized to do business in this state, or a cash

equivalent that has been designated in the notice of sale as

acceptable to the trustee, that bidder shall be guilty of a

misdemeanor punishable by a fine of not more than two thousand five

hundred dollars ($2,500).

  In the event the last and highest bidder cancels an instrument

submitted to the trustee as a cash equivalent, the trustee shall

provide a new notice of sale in the manner set forth in Section 2924f

and shall be entitled to recover the costs of the new notice of sale

as provided in Section 2924c.

  (e) Any postponement or discontinuance of the sale proceedings

shall be a cancellation of the last bid.

  (f) In the event that this section conflicts with any other

statute, then this section shall prevail.

  (g) It shall be unlawful for any person, acting alone or in

concert with others, (1) to offer to accept or accept from another,

any consideration of any type not to bid, or (2) to fix or restrain

bidding in any manner, at a sale of property conducted pursuant to a

power of sale in a deed of trust or mortgage. However, it shall not

be unlawful for any person, including a trustee, to state that a

property subject to a recorded notice of default or subject to a sale

conducted pursuant to this chapter is being sold in an "as-is"

condition.

  In addition to any other remedies, any person committing any act

declared unlawful by this subdivision or any act which would operate

as a fraud or deceit upon any beneficiary, trustor, or junior lienor

shall, upon conviction, be fined not more than ten thousand dollars

($10,000) or imprisoned in the county jail for not more than one

year, or be punished by both that fine and imprisonment.

 

 

 

2924i. (a) This section applies to loans secured by a deed of trust

or mortgage on real property containing one to four residential

units at least one of which at the time the loan is made is or is to

be occupied by the borrower if the loan is for a period in excess of

one year and is a balloon payment loan.

  (b) This section shall not apply to (1) open end credit as defined

in Regulation Z, whether or not the transaction is otherwise subject

to Regulation Z, (2) transactions subject to Section 2956, or (3)

loans made for the principal purpose of financing the construction of

one or more residential units.

  (c) At least 90 days but not more than 150 days prior to the due

date of the final payment on a loan that is subject to this section,

the holder of the loan shall deliver or mail by first-class mail,

with a certificate of mailing obtained from the United States Postal

Service, to the trustor, or his or her successor in interest, at the

last known address of that person, a written notice which shall

include all of the following:

  (1) A statement of the name and address of the person to whom the

final payment is required to be paid.

  (2) The date on or before which the final payment is required to

be paid.

  (3) The amount of the final payment, or if the exact amount is

unknown, a good faith estimate of the amount thereof, including

unpaid principal, interest and any other charges, such amount to be

determined assuming timely payment in full of all scheduled

installments coming due between the date the notice is prepared and

the date when the final payment is due.

  (4) If the borrower has a contractual right to refinance the final

payment, a statement to that effect.

  If the due date of the final payment of a loan subject to this

section is extended prior to the time notice is otherwise required

under this subdivision, this notice requirement shall apply only to

the due date as extended (or as subsequently extended).

  (d) For purposes of this section:

  (1) A "balloon payment loan" is a loan which provides for a final

payment as originally scheduled which is more than twice the amount

of any of the immediately preceding six regularly scheduled payments

or which contains a call provision; provided, however, that if the

call provision is not exercised by the holder of the loan, the

existence of the unexercised call provision shall not cause the loan

to be deemed to be a balloon payment loan.

  (2) "Call provision" means a loan contract term that provides the

holder of the loan with the right to call the loan due and payable

either after a specified period has elapsed following closing or

after a specified date.

  (3) "Regulation Z" means any rule, regulation, or interpretation

promulgated by the Board of Governors of the Federal Reserve System

under the Federal Truth in Lending Act, as amended (15 U.S.C. Sec.

1601 et seq.), and any interpretation or approval thereof issued by

an official or employee of the Federal Reserve System duly authorized

by the board under the Truth in Lending Act, as amended, to issue

such interpretations or approvals.

  (e) Failure to provide notice as required by subdivision (a) does

not extinguish any obligation of payment by the borrower, except that

the due date for any balloon payment shall be the date specified in

the balloon payment note, or 90 days from the date of delivery or

mailing of the notice required by subdivision (a), or the due date

specified in the notice required by subdivision (a), whichever date

is later. If the operation of this section acts to extend the term

of any note, interest shall continue to accrue for the extended term

at the contract rate and payments shall continue to be due at any

periodic interval and on any payment schedule specified in the note

and shall be credited to principal or interest under the terms of the

note. Default in any extended periodic payment shall be considered

a default under terms of the note or security instrument.

  (f) (1) The validity of any credit document or of any security

document subject to the provisions of this section shall not be

invalidated solely because of the failure of any person to comply

with this section. However, any person who willfully violates any

provision of this section shall be liable in the amount of actual

damages suffered by the debtor as the proximate result of the

violation, and, if the debtor prevails in any suit to recover that

amount, for reasonable attorney's fees.

  (2) No person may be held liable in any action under this section

if it is shown by a preponderance of the evidence that the violation

was not intentional and resulted from a bona fide error

notwithstanding the maintenance of procedures reasonably adopted to

avoid any such error.

  (g) The provisions of this section shall apply to any note

executed on or after January 1, 1984.

 

 

 

2924j. (a) Unless an interpleader action has been filed, within 30

days of the execution of the trustee's deed resulting from a sale in

which there are proceeds remaining after payment of the amounts

required by paragraphs (1) and (2) of subdivision (a) of Section

2924k, the trustee shall send written notice to all persons with

recorded interests in the real property as of the date immediately

prior to the trustee's sale who would be entitled to notice pursuant

to subdivisions (b) and (c) of Section 2924b. The notice shall be

sent by first-class mail in the manner provided in paragraph (1) of

subdivision (c) of Section 2924b and inform each entitled person of

each of the following:

  (1) That there has been a trustee's sale of the described real

property.

  (2) That the noticed person may have a claim to all or a portion

of the sale proceeds remaining after payment of the amounts required

by paragraphs (1) and (2) of subdivision (a) of Section 2924k.

  (3) The noticed person may contact the trustee at the address

provided in the notice to pursue any potential claim.

  (4) That before the trustee can act, the noticed person may be

required to present proof that the person holds the beneficial

interest in the obligation and the security interest therefor. In the

case of a promissory note secured by a deed of trust, proof that the

person holds the beneficial interest may include the original

promissory note and assignment of beneficial interests related

thereto. The noticed person shall also submit a written claim to the

trustee, executed under penalty of perjury, stating the following:

  (A) The amount of the claim to the date of trustee's sale.

  (B) An itemized statement of the principal, interest, and other

charges.

  (C) That claims must be received by the trustee at the address

stated in the notice no later than 30 days after the date the trustee

sends notice to the potential claimant.

  (b) The trustee shall exercise due diligence to determine the

priority of the written claims received by the trustee to the trustee'

s sale surplus proceeds from those persons to whom notice was sent

pursuant to subdivision (a). In the event there is no dispute as to

the priority of the written claims submitted to the trustee, proceeds

shall be paid within 30 days after the conclusion of the notice

period. If the trustee has failed to determine the priority of

written claims within 90 days following the 30-day notice period,

then within 10 days thereafter the trustee shall deposit the funds

with the clerk of the court pursuant to subdivision (c) or file an

interpleader action pursuant to subdivision (e). Nothing in this

section shall preclude any person from pursuing other remedies or

claims as to surplus proceeds.

  (c) If, after due diligence, the trustee is unable to determine

the priority of the written claims received by the trustee to the

trustee's sale surplus of multiple persons or if the trustee

determines there is a conflict between potential claimants, the

trustee may file a declaration of the unresolved claims and deposit

with the clerk of the superior court of the county in which the sale

occurred, that portion of the sales proceeds that cannot be

distributed, less any fees charged by the clerk pursuant to this

subdivision. The declaration shall specify the date of the trustee's

sale, a description of the property, the names and addresses of all

persons sent notice pursuant to subdivision (a), a statement that the

trustee exercised due diligence pursuant to subdivision (b), that

the trustee provided written notice as required by subdivisions (a)

and (d) and the amount of the sales proceeds deposited by the trustee

with the court. Further, the trustee shall submit a copy of the

trustee's sales guarantee and any information relevant to the

identity, location, and priority of the potential claimants with the

court and shall file proof of service of the notice required by

subdivision (d) on all persons described in subdivision (a).

  The clerk shall deposit the amount with the county treasurer or,

if a bank account has been established for moneys held in trust under

paragraph (2) of subdivision (a) of Section 77009 of the Government

Code, in that account, subject to order of the court upon the

application of any interested party. The clerk may charge a

reasonable fee for the performance of activities pursuant to this

subdivision equal to the fee for filing an interpleader action

pursuant to Chapter 5.8 (commencing with Section 70600) of Title 8 of

the Government Code. Upon deposit of that portion of the sale

proceeds that cannot be distributed by due diligence, the trustee

shall be discharged of further responsibility for the disbursement of

sale proceeds. A deposit with the clerk of the court pursuant to

this subdivision may be either for the total proceeds of the trustee'

s sale, less any fees charged by the clerk, if a conflict or

conflicts exist with respect to the total proceeds, or that portion

that cannot be distributed after due diligence, less any fees charged

by the clerk.

  (d) Before the trustee deposits the funds with the clerk of the

court pursuant to subdivision (c), the trustee shall send written

notice by first-class mail, postage prepaid, to all persons described

in subdivision (a) informing them that the trustee intends to

deposit the funds with the clerk of the court and that a claim for

the funds must be filed with the court within 30 days from the date

of the notice, providing the address of the court in which the funds

were deposited, and a telephone number for obtaining further

information.

  Within 90 days after deposit with the clerk, the court shall

consider all claims filed at least 15 days before the date on which

the hearing is scheduled by the court, the clerk shall serve written

notice of the hearing by first-class mail on all claimants identified

in the trustee's declaration at the addresses specified therein.

Where the amount of the deposit is twenty-five thousand dollars

($25,000) or less, a proceeding pursuant to this section is a limited

civil case. The court shall distribute the deposited funds to any

and all claimants entitled thereto.

  (e) Nothing in this section restricts the ability of a trustee to

file an interpleader action in order to resolve a dispute about the

proceeds of a trustee's sale. Once an interpleader action has been

filed, thereafter the provisions of this section do not apply.

  (f) "Due diligence," for the purposes of this section means that

the trustee researched the written claims submitted or other evidence

of conflicts and determined that a conflict of priorities exists

between two or more claimants which the trustee is unable to resolve.

 

  (g) To the extent required by the Unclaimed Property Law, a

trustee in possession of surplus proceeds not required to be

deposited with the court pursuant to subdivision (b) shall comply

with the Unclaimed Property Law (Chapter 7 (commencing with Section

1500) of Title 10 of Part 3 of the Code of Civil Procedure).

  (h) The trustee, beneficiary, or counsel to the trustee or

beneficiary, is not liable for providing to any person who is

entitled to notice pursuant to this section, information set forth

in, or a copy of, subdivision (h) of Section 2945.3.

 

 

 

2924k. (a) The trustee, or the clerk of the court upon order to the

clerk pursuant to subdivision (d) of Section 2924j, shall distribute

the proceeds, or a portion of the proceeds, as the case may be, of

the trustee's sale conducted pursuant to Section 2924h in the

following order of priority:

  (1) To the costs and expenses of exercising the power of sale and

of sale, including the payment of the trustee's fees and attorney's

fees permitted pursuant to subdivision (b) of Section 2924d and

subdivision (b) of this section.

  (2) To the payment of the obligations secured by the deed of trust

or mortgage which is the subject of the trustee's sale.

  (3) To satisfy the outstanding balance of obligations secured by

any junior liens or encumbrances in the order of their priority.

  (4) To the trustor or the trustor's successor in interest. In the

event the property is sold or transferred to another, to the vested

owner of record at the time of the trustee's sale.

  (b) A trustee may charge costs and expenses incurred for such

items as mailing and a reasonable fee for services rendered in

connection with the distribution of the proceeds from a trustee's

sale, including, but not limited to, the investigation of priority

and validity of claims and the disbursement of funds. If the fee

charged for services rendered pursuant to this subdivision does not

exceed one hundred dollars ($100), or one hundred twenty-five dollars

($125) where there are obligations specified in paragraph (3) of

subdivision (a), the fee is conclusively presumed to be reasonable.

 

 

 

2924l. (a) In the event that a trustee under a deed of trust is

named in an action or proceeding in which that deed of trust is the

subject, and in the event that the trustee maintains a reasonable

belief that it has been named in the action or proceeding solely in

its capacity as trustee, and not arising out of any wrongful acts or

omissions on its part in the performance of its duties as trustee,

then, at any time, the trustee may file a declaration of nonmonetary

status. The declaration shall be served on the parties in the manner

set forth in Chapter 5 (commencing with Section 1010) of Title 14 of

the Code of Civil Procedure.

  (b) The declaration of nonmonetary status shall set forth the

status of the trustee as trustee under the deed of trust that is the

subject of the action or proceeding, that the trustee knows or

maintains a reasonable belief that it has been named as a defendant

in the proceeding solely in its capacity as a trustee under the deed

of trust, its reasonable belief that it has not been named as a

defendant due to any acts or omissions on its part in the performance

of its duties as trustee, the basis for that knowledge or reasonable

belief, and that it agrees to be bound by whatever order or judgment

is issued by the court regarding the subject deed of trust.

  (c) The parties who have appeared in the action or proceeding

shall have 15 days from the service of the declaration by the trustee

in which to object to the nonmonetary judgment status of the

trustee. Any objection shall set forth the factual basis on which

the objection is based and shall be served on the trustee.

  (d) In the event that no objection is served within the 15-day

objection period, the trustee shall not be required to participate

any further in the action or proceeding, shall not be subject to any

monetary awards as and for damages, attorneys' fees or costs, shall

be required to respond to any discovery requests as a nonparty, and

shall be bound by any court order relating to the subject deed of

trust that is the subject of the action or proceeding.

  (e) In the event of a timely objection to the declaration of

nonmonetary status, the trustee shall thereafter be required to

participate in the action or proceeding.

  Additionally, in the event that the parties elect not to, or fail

to, timely object to the declaration of nonmonetary status, but later

through discovery, or otherwise, determine that the trustee should

participate in the action because of the performance of its duties as

a trustee, the parties may file and serve on all parties and the

trustee a motion pursuant to Section 473 of the Code of Civil

Procedure that specifies the factual basis for the demand.  Upon the

court's granting of the motion, the trustee shall thereafter be

required to participate in the action or proceeding, and the court

shall provide sufficient time prior to trial for the trustee to be

able to respond to the complaint, to conduct discovery, and to bring

other pretrial motions in accordance with the Code of Civil

Procedure.

  (f) Upon the filing of the declaration of nonmonetary status, the

time within which the trustee is required to file an answer or other

responsive pleading shall be tolled for the period of time within

which the opposing parties may respond to the declaration. Upon the

timely service of an objection to the declaration on nonmonetary

status, the trustee shall have 30 days from the date of service

within which to file an answer or other responsive pleading to the

complaint or cross-complaint.

  (g) For purposes of this section, "trustee" includes any agent or

employee of the trustee who performs some or all of the duties of a

trustee under this article, and includes substituted trustees and

agents of the beneficiary or trustee.

 

 

 

2925. The fact that a transfer was made subject to defeasance on a

condition, may, for the purpose of showing such transfer to be a

mortgage, be proved (except as against a subsequent purchaser or

incumbrancer for value and without notice), though the fact does not

appear by the terms of the instrument.

 

 

 

2926. A mortgage is a lien upon everything that would pass by a

grant of the property.

 

 

 

2927. A mortgage does not entitle the mortgagee to the possession

of the property, unless authorized by the express terms of the

mortgage; but after the execution of the mortgage the mortgagor may

agree to such change of possession without a new consideration.

 

 

 

 

2928. A mortgage does not bind the mortgagor personally to perform

the act for the performance of which it is a security, unless there

is an express covenant therein to that effect.

 

 

 

2929. No person whose interest is subject to the lien of a mortgage

may do any act which will substantially impair the mortgagee's

security.

 

 

2929.5. (a) A secured lender may enter and inspect the real

property security for the purpose of determining the existence,

location, nature, and magnitude of any past or present release or

threatened release of any hazardous substance into, onto, beneath, or

from the real property security on either of the following:

  (1) Upon reasonable belief of the existence of a past or present

release or threatened release of any hazardous substance into, onto,

beneath, or from the real property security not previously disclosed

in writing to the secured lender in conjunction with the making,

renewal, or modification of a loan, extension of credit, guaranty, or

other obligation involving the borrower.

  (2) After the commencement of nonjudicial or judicial foreclosure

proceedings against the real property security.

  (b) The secured lender shall not abuse the right of entry and

inspection or use it to harass the borrower or tenant of the

property. Except in case of an emergency, when the borrower or

tenant of the property has abandoned the premises, or if it is

impracticable to do so, the secured lender shall give the borrower or

tenant of the property reasonable notice of the secured lender's

intent to enter, and enter only during the borrower's or tenant's

normal business hours. Twenty-four hours' notice shall be presumed

to be reasonable notice in the absence of evidence to the contrary.

  (c) The secured lender shall reimburse the borrower for the cost

of repair of any physical injury to the real property security caused

by the entry and inspection.

  (d) If a secured lender is refused the right of entry and

inspection by the borrower or tenant of the property, or is otherwise

unable to enter and inspect the property without a breach of the

peace, the secured lender may, upon petition, obtain an order from a

court of competent jurisdiction to exercise the secured lender's

rights under subdivision (a), and that action shall not constitute an

action within the meaning of subdivision (a) of Section 726 of the

Code of Civil Procedure.

  (e) For purposes of this section:

  (1) "Borrower" means the trustor under a deed of trust, or a

mortgagor under a mortgage, where the deed of trust or mortgage

encumbers real property security and secures the performance of the

trustor or mortgagor under a loan, extension of credit, guaranty, or

other obligation. The term includes any successor-in-interest of the

trustor or mortgagor to the real property security before the deed

of trust or mortgage has been discharged, reconveyed, or foreclosed

upon.

  (2) "Hazardous substance" includes all of the following:

  (A) Any "hazardous substance" as defined in subdivision (h) of

Section 25281 of the Health and Safety Code.

  (B) Any "waste" as defined in subdivision (d) of Section 13050 of

the Water Code.

  (C) Petroleum, including crude oil or any fraction thereof,

natural gas, natural gas liquids, liquefied natural gas, or synthetic

gas usable for fuel, or any mixture thereof.

  (3) "Real property security" means any real property and

improvements, other than a separate interest and any related interest

in the common area of a residential common interest development, as

the terms "separate interest," "common area," and "common interest

development" are defined in Section 1351, or real property consisting

of one acre or less which contains 1 to 15 dwelling units.

  (4) "Release" means any spilling, leaking, pumping, pouring,

emitting, emptying, discharging, injecting, escaping, leaching,

dumping, or disposing into the environment, including continuing

migration, of hazardous substances into, onto, or through soil,

surface water, or groundwater.

  (5) "Secured lender" means the beneficiary under a deed of trust

against the real property security, or the mortgagee under a mortgage

against the real property security, and any successor-in-interest of

the beneficiary or mortgagee to the deed of trust or mortgage.

 

 

 

(2930.) Section Twenty-nine Hundred and Thirty. Title acquired by

the mortgagor subsequent to the execution of the mortgage, inures to

the mortgagee as security for the debt in like manner as if acquired

before the execution.

 

 

2931. A mortgagee may foreclose the right of redemption of the

mortgagor in the manner prescribed by the CODE OF CIVIL PROCEDURE.

 

 

 

2931a. In any action brought to determine conflicting claims to

real property, or for partition of real property or an estate for

years therein, or to foreclose a deed of trust, mortgage, or other

lien upon real property, or in all eminent domain proceedings under

Section 1250.110 et seq., of the Code of Civil Procedure against real

property upon which exists a lien to secure the payment of taxes or

other obligations to an agency of the State of California, other than

ad valorem taxes upon the real property, the state agency charged

with the collection of the tax obligation may be made a party. In

such an action, the court shall have jurisdiction to determine the

priority and effect of the liens described in the complaint in or

upon the real property or estate for years therein, but the

jurisdiction of the court in the action shall not include a

determination of the validity of the tax giving rise to the lien or

claim of lien. The complaint or petition in the action shall contain

a description of the lien sufficient to enable the tax or other

obligation, payment of which it secures, to be identified with

certainty, and shall include the name and address of the person owing

the tax or other obligation, the name of the state agency that

recorded the lien, and the date and place where the lien was

recorded. Services of process in the action shall be made upon the

agency, officer, board, commission, department, division, or other

body charged with the collection of the tax or obligation. It shall

be the duty of the Attorney General to represent the state agency in

the action.

 

 

 

2931b. In all actions in which the State of California is named a

party pursuant to the provisions of Section 2931a and in which real

property or an estate for years therein is sought to be sold, the

Attorney General may, with the consent of the Department of Finance,

bid upon and purchase that real property or estate for years.

 

 

 

 

2931c. The Attorney General may bring an action in the courts of

this or any other state or of the United States to enforce any lien

to secure the payment of taxes or other obligations to the State of

California under the Unemployment Insurance Code, the Revenue and

Taxation Code, or Chapter 6 (commencing with Section 16180) of Part 1

of Division 4 of Title 2 of the Government Code or to subject to

payment of the liability giving rise to the lien any property in

which the debtor has any right, title, or interest. In any action

brought under this section the court shall have jurisdiction to

determine the priority and effect of the lien in or upon the

property, but the jurisdiction of the court in such action shall not

extend to a determination of the validity of the liability giving

rise to the lien.

 

 

 

2932. A power of sale may be conferred by a mortgage upon the

mortgagee or any other person, to be exercised after a breach of the

obligation for which the mortgage is a security.

 

 

 

2932.5. Where a power to sell real property is given to a

mortgagee, or other encumbrancer, in an instrument intended to secure

the payment of money, the power is part of the security and vests in

any person who by assignment becomes entitled to payment of the

money secured by the instrument. The power of sale may be exercised

by the assignee if the assignment is duly acknowledged and recorded.

 

 

 

 

2932.6. (a) Notwithstanding any other provision of law, a financial

institution may undertake to repair any property acquired through

foreclosure under a mortgage or deed of trust.

  (b) As used in this section, the term "financial institution"

includes, but is not limited to, banks, savings associations, credit

unions, and industrial loan companies.

  (c) The rights granted to a financial institution by this section

are in addition to, and not in derogation of, the rights of a

financial institution which otherwise exist.

 

 

 

2933. A power of attorney to execute a mortgage must be in writing,

subscribed, acknowledged, or proved, certified, and recorded in like

manner as powers of attorney for grants of real property.

 

 

 

2934. Any assignment of a mortgage and any assignment of the

beneficial interest under a deed of trust may be recorded, and from

the time the same is filed for record operates as constructive notice

of the contents thereof to all persons; and any instrument by which

any mortgage or deed of trust of, lien upon or interest in real

property, (or by which any mortgage of, lien upon or interest in

personal property a document evidencing or creating which is required

or permitted by law to be recorded), is subordinated or waived as to

priority may be recorded, and from the time the same is filed for

record operates as constructive notice of the contents thereof, to

all persons.

 

 

 

2934a. (a) (1) The trustee under a trust deed upon real property or

an estate for years therein given to secure an obligation to pay

money and conferring no other duties upon the trustee than those

which are incidental to the exercise of the power of sale therein

conferred, may be substituted by the recording in the county in which

the property is located of a substitution executed and acknowledged

by: (A) all of the beneficiaries under the trust deed, or their

successors in interest, and the substitution shall be effective

notwithstanding any contrary provision in any trust deed executed on

or after January 1, 1968; or (B) the holders of more than 50 percent

of the record beneficial interest of a series of notes secured by the

same real property or of undivided interests in a note secured by

real property equivalent to a series transaction, exclusive of any

notes or interests of a licensed real estate broker that is the

issuer or servicer of the notes or interests or of any affiliate of

that licensed real estate broker.

  (2) A substitution executed pursuant to subparagraph (B) of

paragraph (1) is not effective unless all the parties signing the

substitution sign, under penalty of perjury, a separate written

document stating the following:

  (A) The substitution has been signed pursuant to subparagraph (B)

of paragraph (1).

  (B) None of the undersigned is a licensed real estate broker or an

affiliate of the broker that is the issuer or servicer of the

obligation secured by the deed of trust.

  (C) The undersigned together hold more than 50 percent of the

record beneficial interest of a series of notes secured by the same

real property or of undivided interests in a note secured by real

property equivalent to a series transaction.

  (D) Notice of the substitution was sent by certified mail, postage

prepaid, with return receipt requested to each holder of an interest

in the obligation secured by the deed of trust who has not joined in

the execution of the substitution or the separate document.

  The separate document shall be attached to the substitution and be

recorded in the office of the county recorder of each county in

which the real property described in the deed of trust is located.

Once the document required by this paragraph is recorded, it shall

constitute conclusive evidence of compliance with the requirements of

this paragraph in favor of substituted trustees acting pursuant to

this section, subsequent assignees of the obligation secured by the

deed of trust, and subsequent bona fide purchasers or encumbrancers

for value of the real property described therein.

  (3) For purposes of this section, "affiliate of the licensed real

estate broker" includes any person as defined in Section 25013 of the

Corporations Code that is controlled by, or is under common control

with, or who controls, a licensed real estate broker. "Control"

means the possession, direct or indirect, of the power to direct or

cause the direction of management and policies.

  (4) The substitution shall contain the date of recordation of the

trust deed, the name of the trustor, the book and page or instrument

number where the trust deed is recorded, and the name of the new

trustee. From the time the substitution is filed for record, the new

trustee shall succeed to all the powers, duties, authority, and

title granted and delegated to the trustee named in the deed of

trust. A substitution may be accomplished, with respect to multiple

deeds of trust which are recorded in the same county in which the

substitution is being recorded and which all have the same trustee

and beneficiary or beneficiaries, by recording a single document,

complying with the requirements of this section, substituting

trustees for all those deeds of trust.

  (b) If the substitution is effected after a notice of default has

been recorded but prior to the recording of the notice of sale, the

beneficiary or beneficiaries shall cause a copy of the substitution

to be mailed, prior to the recording thereof, in the manner provided

in Section 2924b, to the trustee then of record and to all persons to

whom a copy of the notice of default would be required to be mailed

by the provisions of Section 2924b. An affidavit shall be attached

to the substitution that notice has been given to those persons and

in the manner required by this subdivision.

  (c) Notwithstanding any provision of this section or any provision

in any deed of trust, unless a new notice of sale containing the

name, street address, and telephone number of the substituted trustee

is given pursuant to Section 2924f, any sale conducted by the

substituted trustee shall be void.

  (d) This section shall remain in effect only until January 1,

1998, and shall have no force or effect after that date, unless a

later enacted statute, which is enacted before January 1, 1998,

deletes or extends that date.

 

 

 

2934a. (a) (1) The trustee under a trust deed upon real property or

an estate for years therein given to secure an obligation to pay

money and conferring no other duties upon the trustee than those

which are incidental to the exercise of the power of sale therein

conferred, may be substituted by the recording in the county in which

the property is located of a substitution executed and acknowledged

by: (A) all of the beneficiaries under the trust deed, or their

successors in interest, and the substitution shall be effective

notwithstanding any contrary provision in any trust deed executed on

or after January 1, 1968; or (B) the holders of more than 50 percent

of the record beneficial interest of a series of notes secured by the

same real property or of undivided interests in a note secured by

real property equivalent to a series transaction, exclusive of any

notes or interests of a licensed real estate broker that is the

issuer or servicer of the notes or interests or of any affiliate of

that licensed real estate broker.

  (2) A substitution executed pursuant to subparagraph (B) of

paragraph (1) is not effective unless all the parties signing the

substitution sign, under penalty of perjury, a separate written

document stating the following:

  (A) The substitution has been signed pursuant to subparagraph (B)

of paragraph (1).

  (B) None of the undersigned is a licensed real estate broker or an

affiliate of the broker that is the issuer or servicer of the

obligation secured by the deed of trust.

  (C) The undersigned together hold more than 50 percent of the

record beneficial interest of a series of notes secured by the same

real property or of undivided interests in a note secured by real

property equivalent to a series transaction.

  (D) Notice of the substitution was sent by certified mail, postage

prepaid, with return receipt requested to each holder of an interest

in the obligation secured by the deed of trust who has not joined in

the execution of the substitution or the separate document.

  The separate document shall be attached to the substitution and be

recorded in the office of the county recorder of each county in

which the real property described in the deed of trust is located.

Once the document required by this paragraph is recorded, it shall

constitute conclusive evidence of compliance with the requirements of

this paragraph in favor of substituted trustees acting pursuant to

this section, subsequent assignees of the obligation secured by the

deed of trust and subsequent bona fide purchasers or encumbrancers

for value of the real property described therein.

  (3) For purposes of this section, "affiliate of the licensed real

estate broker" includes any person as defined in Section 25013 of the

Corporations Code that is controlled by, or is under common control

with, or who controls, a licensed real estate broker. "Control"

means the possession, direct or indirect, of the power to direct or

cause the direction of management and policies.

  (4) The substitution shall contain the date of recordation of the

trust deed, the name of the trustor, the book and page or instrument

number where the trust deed is recorded, and the name of the new

trustee. From the time the substitution is filed for record, the new

trustee shall succeed to all the powers, duties, authority, and

title granted and delegated to the trustee named in the deed of

trust. A substitution may be accomplished, with respect to multiple

deeds of trust which are recorded in the same county in which the

substitution is being recorded and which all have the same trustee

and beneficiary or beneficiaries, by recording a single document,

complying with the requirements of this section, substituting

trustees for all those deeds of trust.

  (b) If the substitution is executed, but not recorded, prior to or

concurrently with the recording of the notice of default, the

beneficiary or beneficiaries or their authorized agents shall cause

notice of the substitution to be mailed prior to or concurrently with

the recording thereof, in the manner provided in Section 2924b, to

all persons to whom a copy of the notice of default would be required

to be mailed by the provisions of Section 2924b. An affidavit shall

be attached to the substitution that notice has been given to those

persons and in the manner required by this subdivision.

  (c) If the substitution is effected after a notice of default has

been recorded but prior to the recording of the notice of sale, the

beneficiary or beneficiaries or their authorized agents shall cause a

copy of the substitution to be mailed, prior to, or concurrently

with, the recording thereof, in the manner provided in Section 2924b,

to the trustee then of record and to all persons to whom a copy of

the notice of default would be required to be mailed by the

provisions of Section 2924b. An affidavit shall be attached to the

substitution that notice has been given to those persons and in the

manner required by this subdivision.

  (d) A trustee named in a recorded substitution of trustee shall

be deemed to be authorized to act as the trustee under the mortgage

or deed of trust for all purposes from the date the substitution is

executed by the mortgagee, beneficiaries, or by their authorized

agents. Nothing herein requires that a trustee under a recorded

substitution accept the substitution. Once recorded, the

substitution shall constitute conclusive evidence of the authority of

the substituted trustee or his or her agents to act pursuant to this

section.

  (e) Notwithstanding any provision of this section or any

provision in any deed of trust, unless a new notice of sale

containing the name, street address, and telephone number of the

substituted trustee is given pursuant to Section 2924f after

execution of the substitution, any sale conducted by the substituted

trustee shall be void.

  (f) This section shall become operative on January 1, 1998.

 

 

 

2934b. Sections 15643 and 18102 of the Probate Code apply to

trustees under deeds of trust given to secure obligations.

 

 

 

2935. When a mortgage or deed of trust is executed as security for

money due or to become due, on a promissory note, bond, or other

instrument, designated in the mortgage or deed of trust, the record

of the assignment of the mortgage or of the assignment of the

beneficial interest under the deed of trust, is not of itself notice

to the debtor, his heirs, or personal representatives, so as to

invalidate any payment made by them, or any of them, to the person

holding such note, bond, or other instrument.

 

 

 

2936. The assignment of a debt secured by mortgage carries with it

the security.

 

 

 

2937. (a) The Legislature hereby finds and declares that borrowers

or subsequent obligors have the right to know when a person holding a

promissory note, bond, or other instrument transfers servicing of

the indebtedness secured by a mortgage or deed of trust on real

property containing one to four residential units located in this

state. The Legislature also finds that notification to the borrower

or subsequent obligor of the transfer may protect the borrower or

subsequent obligor from fraudulent business practices and may ensure

timely payments.

  It is the intent of the Legislature in enacting this section to

mandate that a borrower or subsequent obligor be given written notice

when a person transfers the servicing of the indebtedness on notes,

bonds, or other instruments secured by a mortgage or deed of trust on

real property containing one to four residential units and located

in this state.

  (b) Any person transferring the servicing of indebtedness as

provided in subdivision (a) to a different servicing agent and any

person assuming from another responsibility for servicing the

instrument evidencing indebtedness, shall give written notice to the

borrower or subsequent obligor before the borrower or subsequent

obligor becomes obligated to make payments to a new servicing agent.

 

  (c) In the event a notice of default has been recorded or a

judicial foreclosure proceeding has been commenced, the person

transferring the servicing of the indebtedness and the person

assuming from another the duty of servicing the indebtedness shall

give written notice to the trustee or attorney named in the notice of

default or judicial foreclosure of the transfer. A notice of

default, notice of sale, or judicial foreclosure shall not be

invalidated solely because the servicing agent is changed during the

foreclosure process.

  (d) Any person transferring the servicing of indebtedness as

provided in subdivision (a) to a different servicing agent shall

provide to the new servicing agent all existing insurance policy

information that the person is responsible for maintaining,

including, but not limited to, flood and hazard insurance policy

information.

  (e) The notices required by subdivision (b) shall be sent by

first-class mail, postage prepaid, to the borrower's or subsequent

obligor's address designated for loan payment billings, or if escrow

is pending, as provided in the escrow, and shall contain each of the

following:

  (1) The name and address of the person to which the transfer of

the servicing of the indebtedness is made.

  (2) The date the transfer was or will be completed.

  (3) The address where all payments pursuant to the transfer are to

be made.

  (f) Any person assuming from another responsibility for servicing

the instrument evidencing indebtedness shall include in the notice

required by subdivision (b) a statement of the due date of the next

payment.

  (g) The borrower or subsequent obligor shall not be liable to the

holder of the note, bond, or other instrument or to any servicing

agent for payments made to the previous servicing agent or for late

charges if these payments were made prior to the borrower or

subsequent obligor receiving written notice of the transfer as

provided by subdivision (e) and the payments were otherwise on time.

 

  (h) For purposes of this section, the term servicing agent shall

not include a trustee exercising a power of sale pursuant to a deed

of trust.

 

 

2937.7. In any action affecting the interest of any trustor or

beneficiary under a deed of trust or mortgage, service of process to

the trustee does not constitute service to the trustor or beneficiary

and does not impose any obligation on the trustee to notify the

trustor or beneficiary of the action.

 

 

 

2938. (a) A written assignment of an interest in leases, rents,

issues, or profits of real property made in connection with an

obligation secured by real property, irrespective of whether the

assignment is denoted as absolute, absolute conditioned upon default,

additional security for an obligation, or otherwise, shall, upon

execution and delivery by the assignor, be effective to create a

present security interest in existing and future leases, rents,

issues, or profits of that real property. As used in this section,

"leases, rents, issues, and profits of real property" include the

cash proceeds thereof. The term "cash proceeds" means cash, checks,

deposit accounts, and the like.

  (b) An assignment of an interest in leases, rents, issues, or

profits of real property may be recorded in the records of the county

recorder in which the underlying real property is located in the

same manner as any other conveyance of an interest in real property,

whether the assignment is in a separate document or part of a

mortgage or deed of trust, and when so duly recorded in accordance

with the methods, procedures, and requirements for recordation of

conveyances of other interests in real property, (1) the assignment

shall be deemed to give constructive notice of the content of the

assignment with the same force and effect as any other duly recorded

conveyance of an interest in real property and (2) the interest

granted by the assignment shall be deemed fully perfected as of the

time of recordation with the same force and effect as any other duly

recorded conveyance of an interest in real property, notwithstanding

any provision of the assignment or any provision of law that would

otherwise preclude or defer enforcement of the rights granted the

assignee under the assignment until the occurrence of a subsequent

event, including, but not limited to, a subsequent default of the

assignor, or the assignee's obtaining possession of the real property

or the appointment of a receiver.

  (c) Upon default of the assignor under the obligation secured by

the assignment of leases, rents, issues, and profits, the assignee

shall be entitled to enforce the assignment in accordance with this

section. On and after the date the assignee takes one or more of the

enforcement steps described in this subdivision, the assignee shall

be entitled to collect and receive all rents, issues, and profits

that have accrued but remain unpaid and uncollected by the assignor

or its agent or for the assignor's benefit on that date, and all

rents, issues, and profits that accrue on or after the date. The

assignment shall be enforced by one or more of the following:

  (1) The appointment of a receiver.

  (2) Obtaining possession of the rents, issues, or profits.

  (3) Delivery to any one or more of the tenants of a written demand

for turnover of rents, issues, and profits in the form specified in

subdivision (j), a copy of which demand shall also be delivered to

the assignor; and a copy of which shall be mailed to all other

assignees of record of the leases, rents, issues, and profits of the

real property at the address for notices provided in the assignment

or, if none, to the address to which the recorded assignment was to

be mailed after recording.

  (4) Delivery to the assignor of a written demand for the rents,

issues, or profits, a copy of which shall be mailed to all other

assignees of record of the leases, rents, issues, and profits of the

real property at the address for notices provided in the assignment

or, if none, to the address to which the recorded assignment was to

be mailed after recording.

  Moneys received by the assignee pursuant to this subdivision, net

of amounts paid pursuant to subdivision (g), if any, shall be applied

by the assignee to the debt or otherwise in accordance with the

assignment or the promissory note, deed of trust, or other instrument

evidencing the obligation; provided, however, that neither the

application nor the failure to so apply the rents, issues, or profits

shall result in a loss of any lien or security interest which the

assignee may have in the underlying real property or any other

collateral, render the obligation unenforceable, constitute a

violation of Section 726 of the Code of Civil Procedure, or otherwise

limit any right available to the assignee with respect to its

security.

  (d) If an assignee elects to take the action provided for under

paragraph (3) of subdivision (c), the demand provided for therein

shall be signed under penalty of perjury by the assignee or an

authorized agent of the assignee and shall be effective as against

the tenant when actually received by the tenant at the address for

notices provided under the lease or other contractual agreement under

which the tenant occupies the property or, if no address for notices

is so provided, at the property. Upon receipt of this demand, the

tenant shall be obligated to pay to the assignee all rents, issues,

and profits that are past due and payable on the date of receipt of

the demand, and all rents, issues, and profits coming due under the

lease following the date of receipt of the demand, unless either of

the following occurs:

  (1) The tenant has previously received a demand which is valid on

its face from another assignee of the leases, issues, rents, and

profits sent by the other assignee in accordance with this

subdivision and subdivision (c).

  (2) The tenant, in good faith and in a manner which is not

inconsistent with the lease, has previously paid, or within 10 days

following receipt of the demand notice pays, the rent to the

assignor.

  Payment of rent to an assignee following a demand under an

assignment of leases, rents, issues, and profits shall satisfy the

tenant's obligation to pay the amounts under the lease. If a tenant

pays rent to the assignor after receipt of a demand other than under

the circumstances described in this subdivision, the tenant shall not

be discharged of the obligation to pay rent to the assignee, unless

the tenant occupies the property for residential purposes. The

obligation of a tenant to pay rent pursuant to this subdivision and

subdivision (c) shall continue until receipt by the tenant of a

written notice from a court directing the tenant to pay the rent in a

different manner or receipt by the tenant of a written notice from

the assignee from whom the demand was received canceling the demand,

whichever occurs first. Nothing in this subdivision shall affect the

entitlement to rents, issues, or profits as between assignees as set

forth in subdivision (h).

  (e) No enforcement action of the type authorized by subdivision

(c), and no collection, distribution, or application of rents,

issues, or profits by the assignee following an enforcement action of

the type authorized by subdivision (c), shall do any of the

following:

  (1) Make the assignee a mortgagee in possession of the property,

except if the assignee obtains actual possession of the real

property, or an agent of the assignor.

  (2) Constitute an action, render the obligation unenforceable,

violate Section 726 of the Code of Civil Procedure or, other than

with respect to marshaling requirements, otherwise limit any rights

available to the assignee with respect to its security.

  (3) Be deemed to create any bar to a deficiency judgment pursuant

to any provision of law governing or relating to deficiency judgments

following the enforcement of any encumbrance, lien, or security

interest, notwithstanding that the action, collection, distribution,

or application may reduce the indebtedness secured by the assignment

or by any deed of trust or other security instrument.

  The application of rents, issues, or profits to the secured

obligation shall satisfy the secured obligation to the extent of

those rents, issues, or profits, and, notwithstanding any provisions

of the assignment or other loan documents to the contrary, shall be

credited against any amounts necessary to cure any monetary default

for purposes of reinstatement under Section 2924c.

  (f) If cash proceeds of rents, issues or profits to which the

assignee is entitled following enforcement as set forth in

subdivision (c) are received by the assignor or its agent for

collection or by any other person who has collected such rents,

issues, or profits for the assignor's benefit, or for the benefit of

any subsequent assignee under the circumstances described in

subdivision (h), following the taking by the assignee of either of

the enforcement actions authorized in paragraph (3) or (4) of

subdivision (c), and the assignee has not authorized the assignor's

disposition of the cash proceeds in a writing signed by the assignee,

the rights to the cash proceeds and to the recovery of the cash

proceeds shall be determined by the following:

  (1) The assignee shall be entitled to an immediate turnover of the

cash proceeds received by the assignor or its agent for collection

or any other person who has collected the rents, issues, or profits

for the assignor's benefit, or for the benefit of any subsequent

assignee under the circumstances described in subdivision (h), and

the assignor or other described party in possession of such cash

proceeds shall turn over the full amount of cash proceeds to the

assignee, less any amount representing payment of expenses authorized

by the assignee in writing. The assignee shall have a right to

bring an action for recovery of the cash proceeds, and to recover the

cash proceeds, without the necessity of bringing an action to

foreclose any security interest which it may have in the real

property. This action shall not violate Section 726 of the Code of

Civil Procedure or otherwise limit any right available to the

assignee with respect to its security.

  (2) As between an assignee with an interest in cash proceeds

perfected in the manner set forth in subdivision (b) and enforced in

accordance with paragraph (3) or (4) of subdivision (c) and any other

person claiming an interest in the cash proceeds, other than the

assignor or its agent for collection or one collecting rents, issues,

and profits for the benefit of the assignor, and subject to

subdivision (h), the assignee shall have a continuously perfected

security interest in the cash proceeds to the extent that the cash

proceeds are identifiable. For purposes hereof, cash proceeds are

identifiable if they are either (A) segregated or (B) if commingled

with other funds of the assignor or its agent or one acting on its

behalf, can be traced using the lowest intermediate balance

principle, unless the assignor or other party claiming an interest in

proceeds shows that some other method of tracing would better serve

the interests of justice and equity under the circumstances of the

case. The provisions of this paragraph are subject to any generally

applicable law with respect to payments made in the operation of the

assignor's business.

  (g) (1) If the assignee enforces the assignment under subdivision

(c) by any means other than the appointment of a receiver and

receives rents, issues, or profits pursuant to this enforcement, the

assignor or any other assignee of the affected real property may make

written demand upon the assignee to pay the reasonable costs of

protecting and preserving the property, including payment of taxes

and insurance and compliance with building and housing codes, if any.

 

  (2) On and after the date of receipt of the demand, the assignee

shall pay for the reasonable costs of protecting and preserving the

real property to the extent of any rents, issues, or profits actually

received by the assignee; provided, however, that no such acts by

the assignee shall cause the assignee to become a mortgagee in

possession and the assignee's duties under this subdivision, upon

receipt of a demand from the assignor or any other assignee of the

leases, rents, issues, and profits pursuant to paragraph (1), shall

not be construed to require the assignee to operate or manage the

property, which obligation shall remain that of the assignor.

  (3) The obligation of the assignee hereunder shall continue until

the earlier of (A) the date on which the assignee obtains the

appointment of a receiver for the real property pursuant to

application to a court of competent jurisdiction, or (B) the date on

which the assignee ceases to enforce the assignment.

  (4) Nothing in this subdivision shall be construed to supersede or

diminish the right of the assignee to the appointment of a receiver.

 

  (h) The lien priorities, rights, and interests among creditors

concerning rents, issues, or profits collected before the enforcement

by the assignee shall be governed by subdivisions (a) and (b).

Without limiting the generality of the foregoing, if an assignee who

has recorded its interest in leases, rents, issues, and profits prior

to the recordation of such interest by a subsequent assignee seeks

to enforce its interest in those rents, issues, or profits in

accordance with this section after any enforcement action has been

taken by a subsequent assignee, the prior assignee shall be entitled

only to the rents, issues, and profits that are accrued and unpaid as

of the date of its enforcement action and unpaid rents, issues, and

profits accruing thereafter. The prior assignee shall have no right

to rents, issues, or profits paid prior to the date of the

enforcement action, whether in the hands of the assignor or any

subsequent assignee. Upon receipt of notice that the prior assignee

has enforced its interest in the rents, issues, and profits, the

subsequent assignee shall immediately send a notice to any tenant to

whom it has given notice under subdivision (c). The notice shall

inform the tenant that the subsequent assignee cancels its demand

that the tenant pay rent to the subsequent assignee.

  (i) This section shall apply to contracts entered into on or after

January 1, 1997.

  Sections 2938 and 2938.1, as these sections were in effect prior

to January 1, 1997, shall govern contracts entered into prior to

January 1, 1997, and shall govern actions and proceedings initiated

on the basis of these contracts.

  (j) "Real property," as used in this section, shall mean real

property or any estate or interest therein.

  (k) The demand required by paragraph (3) of subdivision (c) shall

be in the following form:

   DEMAND TO PAY RENT TO

PARTY OTHER THAN LANDLORD

(SECTION 2938 OF THE CIVIL CODE)

  Tenant: (Name of Tenant)

   Property Occupied by Tenant: (Address)

   Landlord: (Name of Landlord)

   Secured Party: (Name of Secured Party)

   Address: (Address for Payment of Rent to Secured Party and for

Further Information):

   The secured party named above is the assignee of leases, rents,

issues, and profits under (name of document) dated ______, and

recorded at (recording information) in the official records of

___________ County, California. You may request a copy of such

assignment from the secured party at ____ (address).

   THIS NOTICE AFFECTS YOUR LEASE OR RENTAL AGREEMENT RIGHTS AND

OBLIGATIONS. YOU ARE THEREFORE ADVISED TO CONSULT AN ATTORNEY

CONCERNING THOSE RIGHTS AND OBLIGATIONS IF YOU HAVE ANY QUESTIONS

REGARDING YOUR RIGHTS AND OBLIGATIONS UNDER THIS NOTICE.

   IN ACCORDANCE WITH SUBDIVISION (C) OF SECTION 2938 OF THE CIVIL

CODE, YOU ARE HEREBY DIRECTED TO PAY TO THE SECURED PARTY, ____

(NAME OF SECURED PARTY) AT ____ (ADDRESS), ALL RENTS UNDER YOUR LEASE

OR OTHER RENTAL AGREEMENT WITH THE LANDLORD OR PREDECESSOR IN

INTEREST OF LANDLORD, FOR THE OCCUPANCY OF THE PROPERTY AT ____

(ADDRESS OF RENTAL PREMISES) WHICH ARE PAST DUE AND PAYABLE ON THE

DATE YOU RECEIVE THIS DEMAND, AND ALL RENTS COMING DUE UNDER THE

LEASE OR OTHER RENTAL AGREEMENT FOLLOWING THE DATE YOU RECEIVE THIS

DEMAND UNLESS YOU HAVE ALREADY PAID THIS RENT TO THE LANDLORD IN GOOD

FAITH AND IN A MANNER NOT INCONSISTENT WITH THE AGREEMENT BETWEEN

YOU AND THE LANDLORD. IN THIS CASE, THIS DEMAND NOTICE SHALL REQUIRE

YOU TO PAY TO THE SECURED PARTY ____, (NAME OF THE SECURED PARTY),

ALL RENTS THAT COME DUE FOLLOWING THE DATE OF THE PAYMENT TO THE

LANDLORD.

   IF YOU PAY THE RENT TO THE UNDERSIGNED SECURED PARTY, ____

(NAME OF SECURED PARTY), IN ACCORDANCE WITH THIS NOTICE, YOU DO NOT

HAVE TO PAY THE RENT TO THE LANDLORD. YOU WILL NOT BE SUBJECT TO

DAMAGES OR OBLIGATED TO PAY RENT TO THE SECURED PARTY IF YOU HAVE

PREVIOUSLY RECEIVED A DEMAND OF THIS TYPE FROM A DIFFERENT SECURED

PARTY.

   (For other than residential tenants). IF YOU PAY ANY RENT TO

THE LANDLORD THAT BY THE TERMS OF THIS DEMAND YOU ARE REQUIRED TO PAY

TO THE SECURED PARTY, YOU MAY BE SUBJECT TO DAMAGES INCURRED BY THE

SECURED PARTY BY REASON OF YOUR FAILURE TO COMPLY WITH THIS DEMAND,

AND YOU MAY NOT BE DISCHARGED FROM YOUR OBLIGATION TO PAY SUCH RENT

TO THE SECURED PARTY. YOU WILL NOT BE SUBJECT TO SUCH DAMAGES OR

OBLIGATED TO PAY SUCH RENT TO THE SECURED PARTY IF YOU HAVE

PREVIOUSLY RECEIVED A DEMAND OF THIS TYPE FROM A DIFFERENT ASSIGNEE.

 

   Your obligation to pay rent under this demand shall continue

until you receive either (1) a written notice from a court directing

you to pay the rent in a manner provided therein, or (2) a written

notice from the secured party named above canceling this demand.

   The undersigned hereby certifies, under penalty of perjury,

that the undersigned is an authorized officer or agent of the secured

party and that the secured party is the assignee, or the current

successor to the assignee, under an assignment of leases, rents,

issues, or profits executed by the landlord, or a predecessor in

interest, that is being enforced pursuant to and in accordance with

Section 2938 of the Civil Code.

   Executed at _________, California, this ____ day of _________,

_____.

 

 

               (Secured Party)

 

               Name: _____________________________

 

               Title: ____________________________

 

 

 

 

2939. A recorded mortgage must be discharged by a certificate

signed by the mortgagee, his personal representatives or assigns,

acknowledged or proved and certified as prescribed by the chapter on

"recording transfers," stating that the mortgage has been paid,

satisfied, or discharged. Reference shall be made in said

certificate to the book and page where the mortgage is recorded.

 

 

 

2939.5. Foreign executors, administrators and guardians may satisfy

mortgages upon the records of any county in this state, upon

producing and recording in the office of the county recorder of the

county in which such mortgage is recorded, a duly certified and

authenticated copy of their letters testamentary, or of

administration or of guardianship, and which certificate or

authentication shall also recite that said letters have not been

revoked. For the purposes of this section, "guardian" includes a

foreign conservator, committee, or comparable fiduciary.

 

 

 

 

2940. A certificate of the discharge of a mortgage, and the proof

or acknowledgment thereof, must be recorded in the office of the

county recorder in which the mortgage is recorded.

 

 

 

2941. (a) Within 30 days after any mortgage has been satisfied, the

mortgagee or the assignee of the mortgagee shall execute a

certificate of the discharge thereof, as provided in Section 2939,

and shall record or cause to be recorded in the office of the county

recorder in which the mortgage is recorded. The mortgagee shall then

deliver, upon the written request of the mortgagor or the mortgagor'

s heirs, successors, or assignees, as the case may be, the original

note and mortgage to the person making the request.

  (b) (1) Within 30 calendar days after the obligation secured by

any deed of trust has been satisfied, the beneficiary or the assignee

of the beneficiary shall execute and deliver to the trustee the

original note, deed of trust, request for a full reconveyance, and

other documents as may be necessary to reconvey, or cause to be

reconveyed, the deed of trust.

  (A) The trustee shall execute the full reconveyance and shall

record or cause it to be recorded in the office of the county

recorder in which the deed of trust is recorded within 21 calendar

days after receipt by the trustee of the original note, deed of

trust, request for a full reconveyance, the fee that may be charged

pursuant to subdivision (e), recorder's fees, and other documents as

may be necessary to reconvey, or cause to be reconveyed, the deed of

trust.

  (B) The trustee shall deliver a copy of the reconveyance to the

beneficiary, its successor in interest, or its servicing agent, if

known. The reconveyance instrument shall specify one of the

following options for delivery of the instrument, the addresses of

which the recorder has no duty to validate:

  (i) The trustor or successor in interest, and that person's last

known address, as the person to whom the recorder will deliver the

recorded instrument pursuant to Section 27321 of the Government Code.

 

  (ii) That the recorder shall deliver the recorded instrument to

the trustee's address. If the trustee's address is specified for

delivery, the trustee shall mail the recorded instrument to the

trustor or the successor in interest to the last known address for

that party.

  (C) Following execution and recordation of the full reconveyance,

upon receipt of a written request by the trustor or the trustor's

heirs, successors, or assignees, the trustee shall then deliver, or

caused to be delivered, the original note and deed of trust to the

person making that request.

  (D) If the note or deed of trust, or any copy of the note or deed

of trust, is electronic, upon satisfaction of an obligation secured

by a deed of trust, any electronic original, or electronic copy which

has not been previously marked solely for use as a copy, of the note

and deed of trust, shall be altered to indicate that the obligation

is paid in full.

  (2) If the trustee has failed to execute and record, or cause to

be recorded, the full reconveyance within 60 calendar days of

satisfaction of the obligation, the beneficiary, upon receipt of a

written request by the trustor or trustor's heirs, successor in

interest, agent, or assignee, shall execute and acknowledge a

document pursuant to Section 2934a substituting itself or another as

trustee and issue a full reconveyance.

  (3) If a full reconveyance has not been executed and recorded

pursuant to either paragraph (1) or paragraph (2) within 75 calendar

days of satisfaction of the obligation, then a title insurance

company may prepare and record a release of the obligation. However,

at least 10 days prior to the issuance and recording of a full

release pursuant to this paragraph, the title insurance company shall

mail by first-class mail with postage prepaid, the intention to

release the obligation to the trustee, trustor, and beneficiary of

record, or their successor in interest of record, at the last known

address.

  (A) The release shall set forth:

  (i) The name of the beneficiary.

  (ii) The name of the trustor.

  (iii) The recording reference to the deed of trust.

  (iv) A recital that the obligation secured by the deed of trust

has been paid in full.

  (v) The date and amount of payment.

  (B) The release issued pursuant to this subdivision shall be

entitled to recordation and, when recorded, shall be deemed to be the

equivalent of a reconveyance of a deed of trust.

  (4) Where an obligation secured by a deed of trust was paid in

full prior to July 1, 1989, and no reconveyance has been issued and

recorded by October 1, 1989, then a release of obligation as provided

for in paragraph (3) may be issued.

  (5) Paragraphs (2) and (3) do not excuse the beneficiary or the

trustee from compliance with paragraph (1). Paragraph (3) does not

excuse the beneficiary from compliance with paragraph (2).

  (6) In addition to any other remedy provided by law, a title

insurance company preparing or recording the release of the

obligation shall be liable to any party for damages, including

attorney's fees, which any person may sustain by reason of the

issuance and recording of the release, pursuant to paragraphs (3) and

(4).

  (7) A beneficiary may, at its discretion, in accordance with the

requirements and procedures of Section 2934a, substitute the title

company conducting the escrow through which the obligation is

satisfied for the trustee of record, in which case the title company

assumes the obligation of a trustee under this subdivision, and may

collect the fee authorized by subdivision (e).

  (8) In lieu of delivering the original note and deed of trust to

the trustee within 30 days of loan satisfaction, as required by

paragraph (1) of subdivision (b), a beneficiary who executes and

delivers to the trustee a request for a full reconveyance within 30

days of loan satisfaction may, within 120 days of loan satisfaction,

deliver the original note and deed of trust to either the trustee or

trustor. If the note and deed of trust are delivered as provided in

this paragraph, upon satisfaction of the note and deed of trust, the

note and deed of trust shall be altered to indicate that the

obligation is paid in full. Nothing in this paragraph alters the

requirements and obligations set forth in paragraphs (2) and (3).

  (c) For the purposes of this section, the phrases "cause to be

recorded" and "cause it to be recorded" include, but are not limited

to, sending by certified mail with the United States Postal Service

or by an independent courier service using its tracking service that

provides documentation of receipt and delivery, including the

signature of the recipient, the full reconveyance or certificate of

discharge in a recordable form, together with payment for all

required fees, in an envelope addressed to the county recorder's

office of the county in which the deed of trust or mortgage is

recorded. Within two business days from the day of receipt, if

received in recordable form together with all required fees, the

county recorder shall stamp and record the full reconveyance or

certificate of discharge. Compliance with this subdivision shall

entitle the trustee to the benefit of the presumption found in

Section 641 of the Evidence Code.

  (d) The violation of this section shall make the violator liable

to the person affected by the violation for all damages which that

person may sustain by reason of the violation, and shall require that

the violator forfeit to that person the sum of five hundred dollars

($500).

  (e) (1) The trustee, beneficiary, or mortgagee may charge a

reasonable fee to the trustor or mortgagor, or the owner of the land,

as the case may be, for all services involved in the preparation,

execution, and recordation of the full reconveyance, including, but

not limited to, document preparation and forwarding services rendered

to effect the full reconveyance, and, in addition, may collect

official fees. This fee may be made payable no earlier than the

opening of a bona fide escrow or no more than 60 days prior to the

full satisfaction of the obligation secured by the deed of trust or

mortgage.

  (2) If the fee charged pursuant to this subdivision does not

exceed forty-five dollars ($45), the fee is conclusively presumed to

be reasonable.

  (3) The fee described in paragraph (1) may not be charged unless

demand for the fee was included in the payoff demand statement

described in Section 2943.

  (f) For purposes of this section, "original" may include an

optically imaged reproduction when the following requirements are

met:

  (1) The trustee receiving the request for reconveyance and

executing the reconveyance as provided in subdivision (b) is an

affiliate or subsidiary of the beneficiary or an affiliate or

subsidiary of the assignee of the beneficiary, respectively.

  (2) The optical image storage media used to store the document

shall be nonerasable write once, read many (WORM) optical image media

that does not allow changes to the stored document.

  (3) The optical image reproduction shall be made consistent with

the minimum standards of quality approved by either the National

Institute of Standards and Technology or the Association for

Information and Image Management.

  (4) Written authentication identifying the optical image

reproduction as an unaltered copy of the note, deed of trust, or

mortgage shall be stamped or printed on the optical image

reproduction.

  (g) No fee or charge may be imposed on the trustor in connection

with, or relating to, any act described in this section except as

expressly authorized by this section.

  (h) The amendments to this section enacted at the 1999-2000

Regular Session shall apply only to a mortgage or an obligation

secured by a deed of trust that is satisfied on or after January 1,

2001.

  (i) (1) In any action filed before January 1, 2002, that is

dismissed as a result of the amendments to this section enacted at

the 2001-02 Regular Session, the plaintiff shall not be required to

pay the defendant's costs.

  (2) Any claimant, including a claimant in a class action lawsuit,

whose claim is dismissed or barred as a result of the amendments to

this section enacted at the 2001-02 Regular Session, may, within 6

months of the dismissal or barring of the action or claim, file or

refile a claim for actual damages occurring before January 1, 2002,

that were proximately caused by a time lapse between loan

satisfaction and the completion of the beneficiary's obligations as

required under paragraph (1) of subdivision (b). In any action

brought under this section, the defendant may be found liable for

actual damages, but may not be found liable for any civil penalty

authorized by Section 2941.

  (j) Notwithstanding any other penalties, if a beneficiary collects

a fee for reconveyance and thereafter has knowledge, or should have

knowledge, that no reconveyance has been recorded, the beneficiary

shall cause to be recorded the reconveyance, or in the event a

release of obligation is earlier and timely recorded, the beneficiary

shall refund to the trustor the fee charged to perform the

reconveyance. Evidence of knowledge includes, but is not limited to,

notice of a release of obligation pursuant to paragraph (3) of

subdivision (b).

 

 

 

2941.1. Notwithstanding any other provision of law, if no payoff

demand statement is issued pursuant to Section 2943, nothing in

Section 2941 shall be construed to prohibit the charging of a

reconveyance fee.

 

 

2941.5. Every person who willfully violates Section 2941 is guilty

of a misdemeanor punishable by fine of not less than fifty dollars

($50) nor more than four hundred dollars ($400), or by imprisonment

in the county jail for not to exceed six months, or by both such fine

and imprisonment.

  For purposes of this section, "willfully" means simply a purpose

or willingness to commit the act, or make the omission referred to.

It does not require an intent to violate the law, to injure another,

or to acquire any advantage.

 

 

 

2941.7. Whenever the obligation secured by a mortgage or deed of

trust has been fully satisfied and the present mortgagee or

beneficiary of record cannot be located after diligent search, or

refuses to execute and deliver a proper certificate of discharge or

request for reconveyance, or whenever a specified balance, including

principal and interest, remains due and the mortgagor or trustor or

the mortgagor's or trustor's successor in interest cannot, after

diligent search, locate the then mortgagee or beneficiary of record,

the lien of any mortgage or deed of trust shall be released when the

mortgagor or trustor or the mortgagor's or trustor's successor in

interest records or causes to be recorded, in the office of the

county recorder of the county in which the encumbered property is

located, a corporate bond accompanied by a declaration, as specified

in subdivision (b), and with respect to a deed of trust, a

reconveyance as hereinafter provided.

  (a) The bond shall be acceptable to the trustee and shall be

issued by a corporation lawfully authorized to issue surety bonds in

the State of California in a sum equal to the greater of either (1)

two times the amount of the original obligation secured by the

mortgage or deed of trust and any additional principal amounts,

including advances, shown in any recorded amendment thereto, or (2)

one-half of the total amount computed pursuant to (1) and any accrued

interest on such amount, and shall be conditioned for payment of any

sum which the mortgagee or beneficiary may recover in an action on

the obligation secured by the mortgage or deed of trust, with costs

of suit and reasonable attorneys' fees. The obligees under the bond

shall be the mortgagee or mortgagee's successor in interest or the

trustee who executes a reconveyance under this section and the

beneficiary or beneficiary's successor in interest.

  The bond recorded by the mortgagor or trustor or mortgagor's or

trustor's successor in interest shall contain the following

information describing the mortgage or deed of trust:

  (1) Recording date and instrument number or book and page number

of the recorded instrument.

  (2) Names of original mortgagor and mortgagee or trustor and

beneficiary.

  (3) Amount shown as original principal sum secured thereby.

  (4) The recording information and new principal amount shown in

any recorded amendment thereto.

  (b) The declaration accompanying the corporate bond recorded by

the mortgagor or trustor or the mortgagor's or trustor's successor in

interest shall state:

  (1) That it is recorded pursuant to this section.

  (2) The name of the original mortgagor or trustor and mortgagee or

beneficiary.

  (3) The name and address of the person making the declaration.

  (4) That either the obligation secured by the mortgage or deed of

trust has been fully satisfied and the present mortgagee or

beneficiary of record cannot be located after diligent search, or

refuses to execute and deliver a proper certificate of discharge or

request for reconveyance as required under Section 2941; or that a

specified balance, including principal and interest, remains due and

the mortgagor or trustor or mortgagor's or trustor's successor in

interest cannot, after diligent search, locate the then mortgagee or

beneficiary.

  (5) That the declarant has mailed by certified mail, return

receipt requested, to the last address of the person to whom payments

under the mortgage or deed of trust were made and to the last

mortgagee or beneficiary of record at the address for such mortgagee

or beneficiary shown on the instrument creating, assigning, or

conveying the interest, a notice of recording a declaration and bond

under this section and informing the recipient of the name and

address of the mortgagor or trustee, if any, and of the right to

record a written objection with respect to the release of the lien of

the mortgage or, with respect to a deed of trust, notify the trustee

in writing of any objection to the reconveyance of the deed of

trust. The declaration shall state the date any notices were mailed

pursuant to this section and the names and addresses of all persons

to whom mailed.

  The declaration provided for in this section shall be signed by

the mortgagor or trustor under penalty of perjury.

  (c) With respect to a deed of trust, after the expiration of 30

days following the recording of the corporate bond and accompanying

declaration provided in subdivisions (a) and (b), and delivery to the

trustee of the usual reconveyance fees plus costs and a demand for

reconveyance under this section, the trustee shall execute and

record, or otherwise deliver as provided in Section 2941, a

reconveyance in the same form as if the beneficiary had delivered to

the trustee a proper request for reconveyance, provided that the

trustee has not received a written objection to the reconveyance from

the beneficiary of record. No trustee shall have any liability to

any person by reason of its execution of a reconveyance in reliance

upon a trustor's or trustor's successor's in interest substantial

compliance with this section. The sole remedy of any person damaged

by reason of the reconveyance shall be against the trustor, the

affiant, or the bond. With respect to a mortgage, a mortgage shall

be satisfied of record when 30 days have expired following

recordation of the corporate bond and accompanying declaration,

provided no objection to satisfaction has been recorded by the

mortgagee within that period. A bona fide purchaser or encumbrancer

for value shall take the interest conveyed free of such mortgage,

provided there has been compliance with subdivisions (a) and (b) and

the deed to the purchaser recites that no objections by the mortgagee

have been recorded.

  Upon recording of a reconveyance under this section, or, in the

case of a mortgage the expiration of 30 days following recordation of

the corporate bond and accompanying declaration without objection

thereto having been recorded, interest shall no longer accrue as to

any balance remaining due to the extent the balance due has been

alleged in the declaration recorded under subdivision (b).

  The sum of any specified balance, including principal and

interest, which remains due and which is remitted to any issuer of a

corporate bond in conjunction with the issuance of a bond pursuant to

this section shall, if unclaimed, escheat to the state after three

years pursuant to the Unclaimed Property Law. From the date of

escheat the issuer of the bond shall be relieved of any liability to

pay to the beneficiary or his or her heirs or other successors in

interest the escheated funds and the sole remedy shall be a claim for

property paid or delivered to the Controller pursuant to the

Unclaimed Property Law.

  (d) The term "diligent search," as used in this section, shall

mean all of the following:

  (1) The mailing of notices as provided in paragraph (5) of

subdivision (b), and to any other address that the declarant has used

to correspond with or contact the mortgagee or beneficiary.

  (2) A check of the telephone directory in the city where the

mortgagee or beneficiary maintained the mortgagee's or beneficiary's

last known address or place of business.

  (3) In the event the mortgagee or beneficiary or the mortgagee's

or beneficiary's successor in interest is a corporation, a check of

the records of the California Secretary of State and the secretary of

state in the state of incorporation, if known.

  (4) In the event the mortgagee or beneficiary is a state or

national bank or a state or federal savings and loan association, an

inquiry of the regulatory authority of such bank or savings and loan

association.

  (e) This section shall not be deemed to create an exclusive

procedure for the issuance of reconveyances and the issuance of bonds

and declarations to release the lien of a mortgage and shall not

affect any other procedures, whether or not such procedures are set

forth in statute, for the issuance of reconveyances and the issuance

of bonds and declarations to release the lien of a mortgage.

  (f) For purposes of this section, the trustor or trustor's

successor in interest may substitute the present trustee of record

without conferring any duties upon the trustee other than those that

are incidental to the execution of a reconveyance pursuant to this

section if all of the following requirements are met:

  (1) The present trustee of record and the present mortgagee or

beneficiary of record cannot be located after diligent search.

  (2) The declaration filed pursuant to subdivision (b) shall state

in addition that it is filed pursuant to this subdivision, and shall,

in lieu of the provisions of paragraph (4) of subdivision (b), state

that the obligation secured by the mortgage or deed of trust has

been fully satisfied and the present trustee of record and present

mortgagee or beneficiary of record cannot be located after diligent

search.

  (3) The substitute trustee is a title insurance company that

agrees to accept the substitution. This subdivision shall not impose

a duty upon a title insurance company to accept the substitution.

  (4) The corporate bond required in subdivision (a) is for a period

of five or more years.

 

 

 

2941.9. (a) The purpose of this section is to establish a process

through which all of the beneficiaries under a trust deed may agree

to be governed by beneficiaries holding more than 50 percent of the

record beneficial interest of a series of notes secured by the same

real property or of undivided interests in a note secured by real

property equivalent to a series transaction, exclusive of any notes

or interests of a licensed real estate broker that is the issuer or

servicer of the notes or interests or any affiliate of that licensed

real estate broker.

  (b) All holders of notes secured by the same real property or a

series of undivided interests in notes secured by real property

equivalent to a series transaction may agree in writing to be

governed by the desires of the holders of more than 50 percent of the

record beneficial interest of those notes or interests, exclusive of

any notes or interests of a licensed real estate broker that is the

issuer or servicer of the notes or interests of any affiliate of the

licensed real estate broker, with respect to actions to be taken on

behalf of all holders in the event of default or foreclosure for

matters that require direction or approval of the holders, including

designation of the broker, servicing agent, or other person acting on

their behalf, and the sale, encumbrance, or lease of real property

owned by the holders resulting from foreclosure or receipt of a deed

in lieu of foreclosure.

  (c) A description of the agreement authorized in subdivision (b)

of this section shall be disclosed pursuant to Section 10232.5 of the

Business and Professions Code and shall be included in a recorded

document such as the deed of trust or the assignment of interests.

  (d) Any action taken pursuant to the authority granted in this

section is not effective unless all the parties agreeing to the

action sign, under penalty of perjury, a separate written document

entitled "Majority Action Affidavit" stating the following:

  (1) The action has been authorized pursuant to this section.

  (2) None of the undersigned is a licensed real estate broker or an

affiliate of the broker that is the issuer or servicer of the

obligation secured by the deed of trust.

  (3) The undersigned together hold more than 50 percent of the

record beneficial interest of a series of notes secured by the same

real property or of undivided interests in a note secured by real

property equivalent to a series transaction.

  (4) Notice of the action was sent by certified mail, postage

prepaid, with return receipt requested, to each holder of an interest

in the obligation secured by the deed of trust who has not joined in

the execution of the substitution or this document.

  This document shall be recorded in the office of the county

recorder of each county in which the real property described in the

deed of trust is located. Once the document in this subdivision is

recorded, it shall constitute conclusive evidence of compliance with

the requirements of this subdivision in favor of trustees acting

pursuant to this section, substituted trustees acting pursuant to

Section 2934a, subsequent assignees of the obligation secured by the

deed of trust, and subsequent bona fide purchasers or encumbrancers

for value of the real property described therein.

  (e) For purposes of this section, "affiliate of the licensed real

estate broker" includes any person as defined in Section 25013 of the

Corporations Code who is controlled by, or is under common control

with, or who controls, a licensed real estate broker. "Control"

means the possession, direct or indirect, of the power to direct or

cause the direction of management and policies.

 

 

 

2942. Contracts of bottomry or respondentia, although in the nature

of mortgages, are not affected by any of the provisions of this

Chapter.

 

 

2943. (a) As used in this section:

  (1) "Beneficiary" means a mortgagee or beneficiary of a mortgage

or deed of trust, or his or her assignees.

  (2) "Beneficiary statement" means a written statement showing:

  (A) The amount of the unpaid balance of the obligation secured by

the mortgage or deed of trust and the interest rate, together with

the total amounts, if any, of all overdue installments of either

principal or interest, or both.

  (B) The amounts of periodic payments, if any.

  (C) The date on which the obligation is due in whole or in part.

  (D) The date to which real estate taxes and special assessments

have been paid to the extent the information is known to the

beneficiary.

  (E) The amount of hazard insurance in effect and the term and

premium of that insurance to the extent the information is known to

the beneficiary.

  (F) The amount in an account, if any, maintained for the

accumulation of funds with which to pay taxes and insurance premiums.

 

  (G) The nature and, if known, the amount of any additional

charges, costs, or expenses paid or incurred by the beneficiary which

have become a lien on the real property involved.

  (H) Whether the obligation secured by the mortgage or deed of

trust can or may be transferred to a new borrower.

  (3) "Delivery" means depositing or causing to be deposited in the

United States mail an envelope with postage prepaid, containing a

copy of the document to be delivered, addressed to the person whose

name and address is set forth in the demand therefor. The document

may also be transmitted by facsimile machine to the person whose name

and address is set forth in the demand therefor.

  (4) "Entitled person" means the trustor or mortgagor of, or his or

her successor in interest in, the mortgaged or trust property or any

part thereof, any beneficiary under a deed of trust, any person

having a subordinate lien or encumbrance of record thereon, the

escrowholder licensed as an agent pursuant to Division 6 (commencing

with Section 17000) of the Financial Code, or the party exempt by

virtue of Section 17006 of the Financial Code who is acting as the

escrowholder.

  (5) "Payoff demand statement" means a written statement, prepared

in response to a written demand made by an entitled person or

authorized agent, setting forth the amounts required as of the date

of preparation by the beneficiary, to fully satisfy all obligations

secured by the loan that is the subject of the payoff demand

statement. The written statement shall include information

reasonably necessary to calculate the payoff amount on a per diem

basis for the period of time, not to exceed 30 days, during which the

per diem amount is not changed by the terms of the note.

  (b) (1) A beneficiary, or his or her authorized agent, shall,

within 21 days of the receipt of a written demand by an entitled

person or his or her authorized agent, prepare and deliver to the

person demanding it a true, correct, and complete copy of the note or

other evidence of indebtedness with any modification thereto, and a

beneficiary statement.

  (2) A request pursuant to this subdivision may be made by an

entitled person or his or her authorized agent at any time before, or

within two months after, the recording of a notice of default under

a mortgage or deed of trust, or may otherwise be made more than 30

days prior to the entry of the decree of foreclosure.

  (c) A beneficiary, or his or her authorized agent, shall, on the

written demand of an entitled person, or his or her authorized agent,

prepare and deliver a payoff demand statement to the person

demanding it within 21 days of the receipt of the demand. However,

if the loan is subject to a recorded notice of default or a filed

complaint commencing a judicial foreclosure, the beneficiary shall

have no obligation to prepare and deliver this statement as

prescribed unless the written demand is received prior to the first

publication of a notice of sale or the notice of the first date of

sale established by a court.

  (d) (1) A beneficiary statement or payoff demand statement may be

relied upon by the entitled person or his or her authorized agent in

accordance with its terms, including with respect to the payoff

demand statement reliance for the purpose of establishing the amount

necessary to pay the obligation in full. If the beneficiary notifies

the entitled person or his or her authorized agent of any amendment

to the statement, then the amended statement may be relied upon by

the entitled person or his or her authorized agent as provided in

this subdivision.

  (2) If notification of any amendment to the statement is not given

in writing, then a written amendment to the statement shall be

delivered to the entitled person or his or her authorized agent no

later than the next business day after notification.

  (3) Upon the dates specified in subparagraphs (A) and (B) any sums

that were due and for any reason not included in the statement or

amended statement shall continue to be recoverable by the beneficiary

as an unsecured obligation of the obligor pursuant to the terms of

the note and existing provisions of law.

  (A) If the transaction is voluntary, the entitled party or his or

her authorized agent may rely upon the statement or amended statement

upon the earlier of (i) the close of escrow, (ii) transfer of title,

or (iii) recordation of a lien.

  (B) If the loan is subject to a recorded notice of default or a

filed complaint commencing a judicial foreclosure, the entitled party

or his or her authorized agent may rely upon the statement or

amended statement upon the acceptance of the last and highest bid at

a trustee's sale or a court supervised sale.

  (e) The following provisions apply to a demand for either a

beneficiary statement or a payoff demand statement:

  (1) If an entitled person or his or her authorized agent requests

a statement pursuant to this section and does not specify a

beneficiary statement or a payoff demand statement the beneficiary

shall treat the request as a request for a payoff demand statement.

  (2) If the entitled person or the entitled person's authorized

agent includes in the written demand a specific request for a copy of

the deed of trust or mortgage, it shall be furnished with the

written statement at no additional charge.

  (3) The beneficiary may, before delivering a statement, require

reasonable proof that the person making the demand is, in fact, an

entitled person or an authorized agent of an entitled person, in

which event the beneficiary shall not be subject to the penalties of

this section until 21 days after receipt of the proof herein provided

for. A statement in writing signed by the entitled person

appointing an authorized agent when delivered personally to the

beneficiary or delivered by registered return receipt mail shall

constitute reasonable proof as to the identity of an agent. Similar

delivery of a policy of title insurance, preliminary report issued by

a title company, original or photographic copy of a grant deed or

certified copy of letters testamentary, guardianship, or

conservatorship shall constitute reasonable proof as to the identity

of a successor in interest, provided the person demanding a statement

is named as successor in interest in the document.

  (4) If a beneficiary for a period of 21 days after receipt of the

written demand willfully fails to prepare and deliver the statement,

he or she is liable to the entitled person for all damages which he

or she may sustain by reason of the refusal and, whether or not

actual damages are sustained, he or she shall forfeit to the entitled

person the sum of three hundred dollars ($300). Each failure to

prepare and deliver the statement, occurring at a time when, pursuant

to this section, the beneficiary is required to prepare and deliver

the statement, creates a separate cause of action, but a judgment

awarding an entitled person a forfeiture, or damages and forfeiture,

for any failure to prepare and deliver a statement bars recovery of

damages and forfeiture for any other failure to prepare and deliver a

statement, with respect to the same obligation, in compliance with a

demand therefor made within six months before or after the demand as

to which the award was made. For the purposes of this subdivision,

"willfully" means an intentional failure to comply with the

requirements of this section without just cause or excuse.

  (5) If the beneficiary has more than one branch, office, or other

place of business, then the demand shall be made to the branch or

office address set forth in the payment billing notice or payment

book, and the statement, unless it specifies otherwise, shall be

deemed to apply only to the unpaid balance of the single obligation

named in the request and secured by the mortgage or deed of trust

which is payable at the branch or office whose address appears on the

aforesaid billing notice or payment book.

  (6) The beneficiary may make a charge not to exceed thirty dollars

($30) for furnishing each required statement. The provisions of

this paragraph shall not apply to mortgages or deeds of trust insured

by the Federal Housing Administrator or guaranteed by the

Administrator of Veterans Affairs.

  (f) The preparation and delivery of a beneficiary statement or a

payoff demand statement pursuant to this section shall not change a

date of sale established pursuant to Section 2924g.

 

 

 

2944. None of the provisions of this chapter applies to any

transaction or security interest governed by the Commercial Code,

except to the extent made applicable by reason of an election made by

the secured party pursuant to subparagraph (B) of paragraph (1) of

subdivision (a) of Section 9604 of the Commercial Code.

 

 

 

 

2944.5. No lender, mortgagee, or any third party having an interest

in real or personal property shall refuse to accept a policy issued

by an admitted insurer solely because the policy is issued for a

continuous period without a fixed expiration date even though the

policy premium is due and payable every six months, provided the

lender, mortgagee, or third party is entitled to receive (a) notice

of renewal from the insurer within 15 days of receipt of payment on

the policy by the insured or (b) notice of cancellation or nonrenewal

under the terms and conditions set forth in Sections 678 and 2074.8

of the Insurance Code, whichever is applicable.

 

 

 

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