California Foreclosure Law (Cont)
June 15, 2007
The exemptions to the California Foreclosure Law mainly affect when a buyer may be represented by an agent. The law places a bonding requirement on real estate licenses who represent buyers of residences with notices of default against them. The catch 22 is that there presently are no surety insurers who can issue these bonds in California. The exemptions allow certain buyers to have agency representation. The California Association of Realtors has designed a purchase agreement that meets all the requirements set forth by the law.
So how do buyers purchase properties against which there is an outstanding notice of default?
Allow the seller up to five full business days after signing any equity contract or up to 8:00A.M. of the trustees sale day, whichever occurs first, to cancel;
Do not make any untrue or misleading statements regarding value, proceeds, contract terms, seller's rights or obligations;
Do not induce seller to execute or accept any executed instrument of conveyance;
Do not record any instrument of conveyance signed by the seller;
Do not transfer or encumber or puport to transfer or encumber any interest in such propery to a third party;
Do not pay seller any consideration;
Return any documents signed by the seller within 10 days following receipt of cancellation, without any conditions.
Unfortunately, these restrictions are rarely known or understood by the homeowner who is fearful about a foreclosure. The California Association of Realtors is making a huge effort to educate licensees about the sale of property under a notice of default. If you are in the foreclosure situation, you would be well advised to contact a licensed real estate agent and query the agent regarding Home Equity Sales Contracts. If you wish to purchase a property in foreclosure, it is very important that you understand the law as the penalties for violating the law are very severe.
The law was enacted to provide fair guidelines for the benefit of all parties that might become involved in a sale trasnsaction.
The exemptions to the California Foreclosure Law mainly affect when a buyer may be represented by an agent. The law places a bonding requirement on real estate licenses who represent buyers of residences with notices of default against them. The catch 22 is that there presently are no surety insurers who can issue these bonds in California. The exemptions allow certain buyers to have agency representation. The California Association of Realtors has designed a purchase agreement that meets all the requirements set forth by the law.
So how do buyers purchase properties against which there is an outstanding notice of default?
Allow the seller up to five full business days after signing any equity contract or up to 8:00A.M. of the trustees sale day, whichever occurs first, to cancel;
Do not make any untrue or misleading statements regarding value, proceeds, contract terms, seller's rights or obligations;
Do not induce seller to execute or accept any executed instrument of conveyance;
Do not record any instrument of conveyance signed by the seller;
Do not transfer or encumber or puport to transfer or encumber any interest in such propery to a third party;
Do not pay seller any consideration;
Return any documents signed by the seller within 10 days following receipt of cancellation, without any conditions.
Unfortunately, these restrictions are rarely known or understood by the homeowner who is fearful about a foreclosure. The California Association of Realtors is making a huge effort to educate licensees about the sale of property under a notice of default. If you are in the foreclosure situation, you would be well advised to contact a licensed real estate agent and query the agent regarding Home Equity Sales Contracts. If you wish to purchase a property in foreclosure, it is very important that you understand the law as the penalties for violating the law are very severe.
The law was enacted to provide fair guidelines for the benefit of all parties that might become involved in a sale trasnsaction.
posted by shirley harry at 8:42 AM
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