This page will be the main page for you to use from which you can navigate to different resources concerning Palos Verdes Foreclosures. What’s the best way to take advantage of foreclosure opportunities (and I don't mean that in a bad way)? Are there issues that could end up costing you far more than the perceived “savings” you might achieve from buying a foreclosure property? Is it best to buy Palos Verdes foreclosures at a bank auction? What of the Palos Verdes short sales? And would Palos Verdes foreclosures in the default status be candidates for buyers?

How do you FIND PALOS VERDES FORECLOSURES

Use the link above to send me a message detailing your goals in buying foreclosure property. Yes, I understand the perception of getting a good deal. A good deal is such a subjective word. What’s a good deal to Party A is not a good deal to Party B. Is this for your own primary residence that you want to consider buying a foreclosure? Will it be investment property? Are you looking at single family residences, condos, townhomes, or multi-family property?

What about the trends in Palos Verdes Foreclosures? Is the frequency of foreclosures increasing or decreasing? How fast is it taking for banks to take back Palos Verdes homes in foreclosure. What about the bids relative to the value of the homes? While it's said that "all real estate is local", what are some of the trends across California. Whether we're talking about Palos Verdes foreclosures or foreclosures anywhere in the state of California, there is a specific time line that must be followed by lending institutions when and if they decide to foreclose. But before we get into the specifics of the times involved for each process, what are processes involved in Palos Verdes foreclosures? Here's a flow chart that will help:

The Timeline for Palos Verdes Foreclosures

Notice of Default Start of foreclosure process. Initial notice recorded after borrower fails to meet the terms of their loan. CC 2924c.(a)(1) Notice of Trustee Sale Sets auction date. Can be recorded 3 months after Notice of Default CC 2924 c. (b)(1) Auction Initial auction date can be just 20 days after Notice of Trustees Sale is recorded. CC 2924 f. (b)(1) Auctions can postpone for up to one year. CC 2924 g. (c)(1) Postponed/Sold to Bank/Sold to 3rd Party/Cancelled More information on Postponement Reasons Trustee’s Deed Transfers property to winning bidder. By default this will be the lender if no bid higher than the lender’s opening bid is received. CC 2924 h. (c) Preforeclosure Properties are considered to be in Preforeclosure from the filing of the initial Notice of Default until the property is sold at auction. During this period investors can purchase the home directly from the owner, Realtors can list the home, and Lenders can help them refinance. Auction Auction properties have had a Notice of Trustee Sale filed setting an auction date, and have not yet been sold or cancelled. Investors can purchase the home at auction; and Realtors® and Lenders can monitor their client’s properties, to ensure their listing and loan activities are completed before the auction. Bank Owned Bank owned properties received no bid at auction, resulting in the bank taking ownership. These properties are commonly referred to by the banks as REO’s (Real Estate Owned). Investors can purchase these properties directly from the bank; and Realtors® can solicit the listing, since banks will almost certainly market the property for sale.

So what exactly goes on with the California foreclosure process?
What are the steps?
How long does it take?
When can a bank auction off a property?
Prerequisite: Deed of Trust With Power of Sale

Contrary to popular belief, banks can’t just take back property when an owner stops making payments. In non-judicial foreclosure states, the right to foreclose and sell the property actually lies with a 3rd party, known as the trustee; who has a fiduciary responsibility to both the lender and the borrower.

When you purchase a property, ownership is transferred to you using a document known as a deed. When you take a loan (in a non-judicial foreclosure state), you sign a deed of trust, which gives this third-party trustee the right to sell the home if you fail to make payments. This power of sale is what makes non-judicial foreclosure possible.

THE NOTICE OF DEFAULT

Here's the first step in the California foreclosure process. The foreclosure process is first triggered when the lender notifies the trustee that the owner is not paying their loan, as agreed. Upon receiving that notice from the lender, the trustee will issue a Notice of Default, which is typically published in the local paper, posted on the property, and recorded at the County Recorder’s office. This notice provides the borrower with a period of time (varied by State), in which to either dispute the lender’s claim that the borrower has defaulted on their loan, or to pay it current prior to the house being sold. Here are some of the common features of a Notice of Default:

•Puts the owner and public on notice that the foreclosure process has started.

•State statutes define when a Notice of Default can be issued.

•Typically lists the default date and default amount. The default amount can be more than the loan amount in the case of a balloon payment.

•Provides lender contact information to the borrower.

THE NOTICE OF TRUSTEE SALE

Once the owner has received the notice of default and has been given an opportunity to bring the loan current, the next step in the California foreclosure process is that the trustee will proceed with scheduling the auction date and time if the owner has not yet brought the loan current. The Notice of Trustee Sale sets forth the auction date, time, location, and in some States, the opening bid amount. A few states only issue a Notice of Trustee Sale, but in those states there is usually an extended period of time before the Notice of Trustee Sale is issued, and the auction notice also serves as a Notice of Default as well. Here are some of the common features of a Notice of Trustee Sale:

•Sets date, time, and location of the foreclosure auction.

•State statutes specify the required information, format, and procedures for Notices of Trustee Sale, as well as how the trustee sale must be conducted.

•Provides bid amount.

•The published bid amount usually equals the principal balance + past due payments + late fees + foreclosure fees

THE TRUSTEE SALE AUCTION

The last step in the California foreclosure process is the auction. On the date and time of the trustee sale auction, one of four things may occur with the property:

1.The auction for the particular loan may be canceled. This may occur because the property was sold before the auction, and therefore the loan was repaid (or partially repaid in the case of a short sale); the owner was able to refinance the loan; the owner came up with the cash to bring the loan current; or, there may have been an error made in the sale process, and the trustee has decided it would be better to restart the process.

2.The auction may be postponed to a later date and time. Common reasons for postponement include mutual agreement, where the borrower and lender agree to delay the sale; beneficiaries request, where the lender decides to postpone; trustees discretion, where the trustee decides to postpone, often because it can’t reach the lender for bidding instructions; bankruptcy, which actually doesn’t completely stop foreclosure, but instead puts a temporary stay on the sale until the lender can get a motion granted by the judge allowing them to continue the sale; and operation of law, where a court has ordered that the sale not be held.

3.The property may be sold to 3rd. The loan being foreclosed on was offered for sale by the trustee, and a bidder (other than the lender) ended up purchasing the loan.

4.The property was sold to the Bank. Remember that it is the trustee, not the bank, that sells the home. Since the lender clearly has the most to lose in the transaction, and because they are the beneficiary of any funds received from the sale, they are allow to place the first bid, and are allowed to credit bid (bid without bringing cash to the sale), up to the amount they are owed.

Before bidding at an auction it is important to consider the following factors:

•Auctions open to the public—Typically held on the courthouse steps.

•Payment requirements will vary from state to state, but generally, the property must be paid for, in full, at the time of the auction, and bidders are usually required to show proof of payment, typically cashier’s checks or cash, in order to qualify for bidding.

•Generally, you are not able to perform any inspections on the property, other than a visual inspection from the street or neighbors' yards. Hidden work can be extensive, so auction investors need to be prepared to suffer losses from time to time.

•Subject to existing liens and encumbrances. Remember that properties aren’t sold at foreclosure auction—loans are. One of the great things about foreclosure auctions is that it wipes out loans that came after the one being taken to auction. This can help clear up excess debt on the property, allowing it be resold at an affordable price point. The flip side is that the buyer is responsible for any loans or liens on the property prior to the loan being taken to auction. For example, delinquent property taxes, which are a lien on the property, are almost always the responsibility of the new owner.

•No title insurance. One of the things that can help buyers sort out what debt they might get stuck with after buying a property at a trustee sale is a preliminary title report; which would show which existing loans and liens the buyer would be responsible for. One important thing to note is that even the best title companies make mistakes, and occasionally miss items that can have a dramatic impact on the amount owed on the property. To reduce or eliminate this risk, title companies offer homeowners and lenders a title insurance policy that agrees to defend against or pay any claims that their preliminary title report failed to show. Unfortunately, such insurance is generally not available for purchase at trustee sale.

THE TRUSTEE’S DEED

Once the property is sold at auction, the property has been foreclosed. Ownership of the property is transferred to the new owner (whether the bank or a 3rd party bidder) with a Trustee’s Deed, and any secured interest in the property held by junior lienholders is wiped out.

Even though the bank or 3rd party bidder now owns the home, they may have to evict the current occupants. Eviction processes vary from state to state, and can also vary depending on whether the property is occupied by the former owners or a renter. Lease agreements recorded after the foreclosing lien, are wiped out by the foreclosure, just like other liens and encumbrances.

So there you have it; these are the steps to the California foreclosure process.