California Senate Bill SB931
Post date: Jul 03, 2011 4:42:31 AM
On January 1, 2011, California Senate Bill SB931 went into effect and stops deficiency judgments on short sales and foreclosures in California on all first mortgages. This means a lender cannot pursue a deficiency judgment whether the loan was purchase money or a refinance.
California Senate Bill SB931 added Section 580e to the California Code of Civil Procedure. The first part of the bill is similar to Code of Civil Procedure Section 580d, which says:“No judgment shall be rendered for any deficiency upon a note secured by a deed of trust or mortgage upon real property or estate for years therein” when the mortgagee or trustee sells the property with the "power of sale" verbiage in the mortgage or deed of trust.
The Legislation applies to any note secured by a first deed of trust or first mortgage for a dwelling of not more than four units. It protects Homeowners as well as Investors, as it is not limited to consumer transactions, nor limited to homeowner occupied dwellings.
Are you a current homeowner facing a Short Sale or Foreclosure?
You need to educate yourself on the option of a Short Sale vs. Foreclosure.