as amended, Skinner.
begin deleteMortgages: notice of default. end delete
Existing law requires that, upon a breach of the obligation of a mortgage or transfer of an interest in property, the mortgagee, trustee, or beneficiary record a notice of default in the office of the county recorder where the mortgaged or trust property is situated and mail the notice of default to the mortgagor or trustor. Existing law specifies other requirements and procedures for completion of a foreclosure sale, including recording a notice of sale prior to exercising a power of sale. Existing law requires, under a notice of default, that a summary of mortgage terms be provided to the mortgagor or trustor, as specified.end delete
This bill would require a notice of default and the summary of mortgage terms provided to a mortgagor or trustor to include a statement that includes the telephone number of the Homeowners Home Ownership and Opportunity for People Everywhere (HOPE) program or a similar mortgage payment assistance program of the United States Department of Treasury or Housing and Urban Development.end delete
begin deleteno end delete.
State-mandated local program: begin deleteno end delete.
The people of the State of California do enact as follows:
(a) This division does not apply to any person doing
4business under any law of any state or of the United States relating
5to banks, trust companies, savings and loan associations, insurance
6premium finance agencies, credit unions, small business investment
7companies, community advantage lenders, California business and
begin delete corporations,end delete or licensed begin delete pawnbrokers.end delete
11“Community advantage lender” means an entity authorized by
12the United States Small Business Administration to deliver
13community advantage loans.
14(b) This division does not apply to a check casher who holds a
15valid permit issued pursuant to Section 1789.37 of the Civil Code
16when acting under the authority of that permit, and shall not apply
17to a person holding a valid license issued pursuant to Section 23005
18of the Financial Code when acting under the authority of that
20(c) This division does not apply to a college or university making
21a loan for the purpose of permitting a person to pursue a program
22or course of study leading to a degree or certificate.
23(d) This division does not apply to a broker-dealer acting
24pursuant to a certificate then in effect and issued pursuant to
25Section 25211 of the Corporations Code.
26(e) This division does not apply to any person who makes no
begin delete one loanend delete in a 12-month period begin delete as long as that commercial
28loan is aend delete
begin delete loanend delete as defined in
begin delete 22502.end delete
31(f) This division does not apply to any public corporation as
32defined in Section 67510 of the Government Code, any public
33entity other than the state as defined in Section 811.2 of the
P4 1Government Code, or any agency of any one or more of the
2foregoing, when making any loan so long as the public corporation,
3public entity, or agency of any one or more of the foregoing
4complies with all applicable federal and state laws and regulations.
Section 2923.3 of the Civil Code is amended to
(a) With respect to residential real property containing
16no more than four dwelling units, a mortgagee, trustee, beneficiary,
17or authorized agent shall provide to the mortgagor or trustor a copy
18of the recorded notice of default with an attached separate summary
19document of the notice of default in English and the languages
20described in Section 1632, as set forth in subdivision (c), and a
21copy of the recorded notice of sale with an attached separate
22summary document of the information required to be contained
23in the notice of sale in English and the languages described in
24Section 1632, as set forth in subdivision (d). These summaries are
25not required to be recorded or published. This subdivision shall
26become operative on April 1, 2013, or 90 days following the
27issuance of the translations by the Department of Corporations,
28 pursuant to subdivision (b), whichever is later.
29(b) (1) The Department of Corporations shall provide a standard
30translation of the statement in paragraph (1) of subdivision (c),
31and of the summary of the notice of default, as set forth in
32paragraph (2) of subdivision (c) in the languages described in
34(2) The Department of Corporations shall provide a standard
35translation of the statement in paragraph (1) of subdivision (d),
36and of the summary of the notice of sale, as set forth in paragraph
37(2) of subdivision (d).
38(3) The department shall make the translations described in
39paragraphs (1) and (2) available without charge on its Internet Web
40site. Any mortgagee, trustee, beneficiary, or authorized agent who
P7 1provides the department’s translations in the manner prescribed
2by this section shall be in compliance with this section.
3(c) (1) The following statement shall appear in the languages
4described in Section 1632 at the beginning of the notice of default:
6NOTE: THERE IS A SUMMARY OF THE INFORMATION
7IN THIS DOCUMENT ATTACHED.
9(2) The following summary of key information shall be attached
10to the copy of the notice of default provided to the mortgagor or
13SUMMARY OF KEY INFORMATION
14The attached notice of default was sent to [name of the trustor],
15in relation to [description of the property that secures the mortgage
16or deed of trust in default]. This property may be sold to satisfy
17your obligation and any other obligation secured by the deed of
18trust or mortgage that is in default. [Trustor] has, as described in
19the notice of default, breached the mortgage or deed of trust on
20the property described above.
21IMPORTANT NOTICE: IF YOUR PROPERTY IS IN
22FORECLOSURE BECAUSE YOU ARE BEHIND IN YOUR
23PAYMENTS, IT MAY BE SOLD WITHOUT ANY COURT
24ACTION, and you may have the legal right to bring your account
25in good standing by paying all of your past due payments plus
26permitted costs and expenses within the time permitted by law for
27reinstatement of your account, which is normally five business
28days prior to the date set for the sale of your property. No sale date
29may be set until approximately 90 days from the date the attached
30notice of default may be recorded (which date of recordation
31appears on the notice).
32This amount is ____________ as of ___(date)____________and
33will increase until your account becomes current.
34While your property is in foreclosure, you still must pay other
35obligations (such as insurance and taxes) required by your note
36and deed of trust or mortgage. If you fail to make future payments
37on the loan, pay taxes on the property, provide insurance on the
38property, or pay other obligations as required in the note and deed
39of trust or mortgage, the beneficiary or mortgagee may insist that
40you do so in order to reinstate your account in good standing. In
P8 1addition, the beneficiary or mortgagee may require as a condition
2to reinstatement that you provide reliable written evidence that
3you paid all senior liens, property taxes, and hazard insurance
5Upon your written request, the beneficiary or mortgagee will
6give you a written itemization of the entire amount you must pay.
7You may not have to pay the entire unpaid portion of your account,
8even though full payment was demanded, but you must pay all
9amounts in default at the time payment is made. However, you
10and your beneficiary or mortgagee may mutually agree in writing
11prior to the time the notice of sale is posted (which may not be
12earlier than three months after this notice of default is recorded)
13to, among other things, (1) provide additional time in which to
14cure the default by transfer of the property or otherwise; or (2)
15establish a schedule of payments in order to cure your default; or
16both (1) and (2).
17Following the expiration of the time period referred to in the
18first paragraph of this notice, unless the obligation being foreclosed
19upon or a separate written agreement between you and your creditor
20permits a longer period, you have only the legal right to stop the
21sale of your property by paying the entire amount demanded by
23To find out the amount you must pay, or to arrange for payment
24to stop the foreclosure, or if your property is in foreclosure for any
25other reason, contact:
27(Name of beneficiary or mortgagee)
32If you have any questions, you should contact a lawyer or the
33governmental agency which may have insured your loan.
34Notwithstanding the fact that your property is in foreclosure,
35you may offer your property for sale, provided the sale is concluded
36prior to the conclusion of the foreclosure.
37Remember, YOU MAY LOSE LEGAL RIGHTS IF YOU DO
38NOT TAKE PROMPT ACTION.
would like additional copies of this summary, you may
40obtain them by calling [insert telephone number].
P9 1(d) (1) The following statement shall appear in the languages
2described in Section 1632 at the beginning of the notice of sale:
4NOTE: THERE IS A SUMMARY OF THE INFORMATION
5IN THIS DOCUMENT ATTACHED.
7(2) The following summary of key information shall be attached
8to the copy of the notice of sale provided to the mortgagor or
11SUMMARY OF KEY INFORMATION
12The attached notice of sale was sent to [trustor], in relation to
13[description of the property that secures the mortgage or deed of
14 trust in default].
15YOU ARE IN DEFAULT UNDER A (Deed of trust or
16mortgage) DATED ____. UNLESS YOU TAKE ACTION TO
17PROTECT YOUR PROPERTY, IT MAY BE SOLD AT A
19IF YOU NEED AN EXPLANATION OF THE NATURE OF
20THE PROCEEDING AGAINST YOU, YOU SHOULD
21CONTACT A LAWYER.
22The total amount due in the notice of sale is ____.
23Your property is scheduled to be sold on [insert date and time
24of sale] at [insert location of sale].
25However, the sale date shown on the attached notice of sale may
26be postponed one or more times by the mortgagee, beneficiary,
27trustee, or a court, pursuant to Section 2924g of the California
28Civil Code. The law requires that information about trustee sale
29postponements be made available to you and to the public, as a
30courtesy to those not present at the sale. If you wish to learn
31 whether your sale date has been postponed, and, if applicable, the
32rescheduled time and date for the sale of this property, you may
33call [telephone number for information regarding the trustee’s sale]
34 or visit this Internet Web site [Internet Web site address for
35information regarding the sale of this property], using the file
36number assigned to this case [case file number]. Information about
37postponements that are very short in duration or that occur close
38in time to the scheduled sale may not immediately be reflected in
39the telephone information or on the Internet Web site. The best
P10 1way to verify postponement information is to attend the scheduled
3If you would like additional copies of this summary, you may
4obtain them by calling [insert telephone number].
5(e) Failure to provide these summaries to the mortgagor or
6trustor shall have the same effect as if the notice of default or notice
7of sale were incomplete or not provided.
8(f) This section sets forth a requirement for translation in
9languages other than English, and a document complying with the
10provisions of this section may be recorded pursuant to subdivision
11(b) of Section 27293 of the Government Code. A document that
12complies with this section shall not be rejected for recordation on
13the ground that some part of the document is in a language other
15(g) The statement required pursuant to subdivision (c) shall also
16include the telephone number of the Homeowners Home
17Ownership and Opportunity for People Everywhere (HOPE)
18program or a similar mortgage payment assistance program of the
19United States Department of Treasury or Housing and Urban
Section 2924 of the Civil Code is amended to read:
(a) Every transfer of an interest in property, other than
24in trust, made only as a security for the performance of another
25act, is to be deemed a mortgage, except when in the case of
26personal property it is accompanied by actual change of possession,
27in which case it is to be deemed a pledge. Where, by a mortgage
28created after July 27, 1917, of any estate in real property, other
29than an estate at will or for years, less than two, or in any transfer
30in trust made after July 27, 1917, of a like estate to secure the
31performance of an obligation, a power of sale is conferred upon
32the mortgagee, trustee, or any other person, to be exercised after
33a breach of the obligation for which that mortgage or transfer is a
34security, the power shall not be exercised except where the
35mortgage or transfer is made pursuant to an order, judgment, or
36 decree of a court of record, or to secure the payment of bonds or
37other evidences of indebtedness authorized or permitted to be
38issued by the Commissioner of Corporations, or is made by a public
39utility subject to the provisions of the Public Utilities Act, until
40all of the following apply:
P11 1(1) The trustee, mortgagee, or beneficiary, or any of their
2authorized agents shall first file for record, in the office of the
3recorder of each county wherein the mortgaged or trust property
4or some part or parcel thereof is situated, a notice of default. That
5notice of default shall include all of the following:
6(A) A statement identifying the mortgage or deed of trust by
7stating the name or names of the trustor or trustors and giving the
8book and page, or instrument number, if applicable, where the
9mortgage or deed of trust is recorded or a description of the
10mortgaged or trust property.
11(B) A statement that a breach of the obligation for which the
12mortgage or transfer in trust is security has occurred.
13(C) A statement setting forth the nature of each breach actually
14known to the beneficiary and of his or her election to sell or cause
15to be sold the property to satisfy that obligation and any other
16obligation secured by the deed of trust or mortgage that is in
18(D) If the default is curable pursuant to Section 2924c, the
19statement specified in paragraph (1) of subdivision (b) of Section
21(E) A statement that includes the telephone number of the
22Homeowners Home Ownership and Opportunity for People
23Everywhere (HOPE) program or a similar mortgage payment
24assistance program of the United States Department of Treasury
25or Housing and Urban Development.
26(2) Not less than three months shall elapse from the filing of
27the notice of default.
28(3) Except as provided in paragraph (4), after the lapse of the
29three months described in paragraph (2), the mortgagee, trustee,
30or other person authorized to take the sale shall give notice of sale,
31stating the time and place thereof, in the manner and for a time
32not less than that set forth in Section 2924f.
33(4) Notwithstanding paragraph (3), the mortgagee, trustee, or
34other person authorized to take sale may record a notice of sale
35pursuant to Section 2924f up to five days before the lapse of the
36three-month period described in paragraph (2), provided that the
37date of sale is no earlier than three months and 20 days after the
38recording of the notice of default.
39(5) Until January 1, 2018, whenever a sale is postponed for a
40period of at least 10 business days pursuant to Section 2924g, a
P12 1mortgagee, beneficiary, or authorized agent shall provide written
2notice to a borrower regarding the new sale date and time, within
3five business days following the postponement. Information
4provided pursuant to this paragraph shall not constitute the public
5declaration required by subdivision (d) of Section 2924g. Failure
6to comply with this paragraph shall not invalidate any sale that
7would otherwise be valid under Section 2924f. This paragraph
8shall be inoperative on January 1, 2018.
9(6) No entity shall record or cause a notice of default to be
10recorded or otherwise initiate the foreclosure process unless it is
11the holder of the beneficial interest under the mortgage or deed of
12trust, the original trustee or the substituted trustee under the deed
13of trust, or the designated agent of the holder of the beneficial
14interest. No agent of the holder of the beneficial interest under the
15mortgage or deed of trust, original trustee or substituted trustee
16under the deed of trust may record a notice of default or otherwise
17commence the foreclosure process except when acting within the
18scope of authority designated by the holder of the beneficial
20(b) In performing acts required by this article, the trustee shall
21incur no liability for any good faith error resulting from reliance
22on information provided in good faith by the beneficiary regarding
23the nature and the amount of the default under the secured
24obligation, deed of trust, or mortgage. In performing the acts
25required by this article, a trustee shall not be subject to Title 1.6c
26(commencing with Section 1788) of Part 4.
27(c) A recital in the deed executed pursuant to the power of sale
28of compliance with all requirements of law regarding the mailing
29of copies of notices or the publication of a copy of the notice of
30default or the personal delivery of the copy of the notice of default
31or the posting of copies of the notice of sale or the publication of
32a copy thereof shall constitute prima facie evidence of compliance
33with these requirements and conclusive evidence thereof in favor
34of bona fide purchasers and encumbrancers for value and without
36(d) All of the following shall constitute privileged
37communications pursuant to Section 47:
38(1) The mailing, publication, and delivery of notices as required
39by this section.
40(2) Performance of the procedures set forth in this article.
P13 1(3) Performance of the functions and procedures set forth in
2this article if those functions and procedures are necessary to carry
3out the duties described in Sections 729.040, 729.050, and 729.080
4of the Code of Civil Procedure.
5(e) There is a rebuttable presumption that the beneficiary
6actually knew of all unpaid loan payments on the obligation owed
7to the beneficiary and secured by the deed of trust or mortgage
8subject to the notice of default. However, the failure to include an
9actually known default shall not invalidate the notice of sale and
10the beneficiary shall not be precluded from asserting a claim to
11this omitted default or defaults in a separate notice of default.
12(f) With respect to residential real property containing no more
13than four dwelling units, a separate document containing a
14summary of the notice of default information in English and the
15languages described in Section 1632 shall be attached to the notice
16of default provided to the mortgagor or trustor pursuant to Section