I’m in my office today and this is a subject that comes up a lot. Families and individuals calling our office with a foreclosure wanting to know how to stop it. There are 3 primary or reliable ways to stop a foreclosure in California. There are probably a lot more but these are the realistic options that you have. The first is bankruptcy. We all know about bankruptcy. Once a bankruptcy is filed, an automatic stay goes into effect. There are a lot of other videos about that but essentially the filing of a bankruptcy prevents any kind of collection activity from taking place including the lender or the trustee proceeding with foreclosure. So bankruptcy is a great way to stop a foreclosure.
It often times is not a permanent solution because the lender can get released from the stay and go back to foreclosing eventually but it’s a great way to stop foreclosure. The next way to stop a foreclosure in California would be a loan modification. California has unique laws in regard to loan modification. In 2013, they passed the Homeowner’s Bill of Rights which said that in order to foreclose the lender has to have loan modification programs in place for borrowers to apply to and also most importantly, that if the borrower is in the process of applying for a loan modification or being considered for a loan modification, the lender is not allowed to foreclose on them during that process.
Essentially they have to see the process through, evaluate, give the borrower an evaluation and a fair and transparent review and only then can they go back to foreclosing. If they don’t, it’s called dual tracking and that’s definitely something that a borrower homeowner could sue their lender for and it’s very common unfortunately. The other thing that stops a foreclosure is a court order and to get a court order is complicated. Essentially you have to sue your lender, file a wrongful foreclosure lawsuit, dual tracking lawsuit or a Homeowner’s Bill of Rights lawsuit. Something along those lines. Get the complaint filed and then get in front of a judge and present your evidence to the court and to the judge and see if the judge will agree with you.
If you have the evidence and you have the record of everything happening whether it’s dual tracking or notice violations and issues with foreclosure, then there is a pretty good chance never a guarantee but a pretty good chance the judge will agree with you and issue what’s called a temporary restraining order from the lender foreclosing on the property which gives you the borrower the opportunity to try to work something out either with a loan modification or some other type of settlement with the lender and those are some common ways to stop foreclosure in California, probably in my opinion the most reliable ways to stop foreclosure.
If you have any other questions please submit them through my website or our YouTube Channel. I’m happy to make a video and try to address your questions.
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