California Foreclosures & The ‘One Action Rule’ – Violators Could Lose Their Lien On Real Estate
A recent story from Lexology addresses the so-called “one action rule” that applies to foreclosures in California. An excerpt:
- The one action rule places limits on the ability of lenders to enforce and collect debt that is secured by real property located in California. While most states permit secured creditors to freely pursue the foreclosure of real property as well as the underlying debt simultaneously, California essentially requires creditors to exhaust the entirety of their real property security before suing on the underlying debt or before taking other action to collect against any of the debtor’s unpledged assets.
- Violation of the one action rule leaves lenders vulnerable to sanctions, including the potential loss of their lien on the real property. Certain conduct, including setoff against a debtor’s unpledged accounts, may run afoul of the one action rule. Lenders who have extended credit secured by California real property should carefully plan their enforcement and collection strategies in order to avoid violation of the one action rule.
Among the issues addressed in the article are:
- The One Action Rule and its Ramifications,
- What Constitutes Judicial Action and How to Avoid Tripping Over the One Action Rule,
- Why Non-Judicial Foreclosure over Judicial Foreclosure?,
- Preserving a Right to Judgment on the Debt,
- Completing Non-judicial Foreclosures in California,
- Some Practical Tips for Lenders.
For more, see Revisiting the one action rule for secured lenders: forget about California real property at your peril! (requires paid subscription; if no subscription, TRY HERE; or GO HERE – then click the appropriate link for the story).
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What really bothers me is and burns my a$$, is that EVERYBODY KNOWS, everybody in Congress, every Attorney General, Every Senator, Every Judge and even our President. Hell even our ex President, George W. knew, and it was one reason he signed into Law, the “Forgiveness LAW”. So with all of these people in office who took the oath “To Serve and to Protect the Lives and Property of the American People” won’t do a damn thing. Where is our FBI or our Secret Service? Who is there to protect us from the Banksters? What is taking them so long and why is each and every state different with the same problem? We can fix the world but we can’t fix this. This really bothers me. Do you know, it is not just the homeowner who is having trouble that is in this mess …. this mess includes every homeowner who had their mortgage scrutinized and sold to investors. So this goes far beyond just those who are having trouble …. at the moment. If the Bank can not produce the Original Promissory Note, or Deeds or Mortgages then no one and I mean no one should pay on their mortgage. That means even if you can pay …. Don’t !!!! Bank of America can not produce my note, can not tell me who owns my note, nothing is Recorded at the County Recorders Office … and I Refuse to Pay them. I will not pay anyone who is not in ownership of my note. I am now going on 3 years of not paying and not one word from the Banksters except for their threats and intimidation’s. …. oh well … My way of throwing the Tea into the Bay. Civil Disobedience is a Good Thing.
It was my understanding that once your property value drop was 50=75% less than original cost, the second acquired as a lean to purchase home and /or additional inventories, the lender could no longer file a lien on your assets, that it was now invalid or rather worthless since there wasn’t anything of value left to protect it, and I am not an attorney so I am sorry if this is muddled, having communicated what I think that I have read in the California laws; the banks still continue to report you monthly for non payment while going through a modification/short sell or whatever, they also continue to call and come after whatever they think they may talk you into paying, due to intimendation/threat not to get a modification; whatever works for them; and if you can make the time too report it to the FTC, AIG, Ca.Gov., Hud Fair housing or whomever; at the most the Ceo will call from Currectcy Dept, and it ends there; it is only about defending the banks practices; illegal foreclosure, false documentation; doesn’t matter, federal housing and banks both take care of that illegal action, then Freddie and Fannie will foreclose on you, along with the help of Hud, all in the name of helping the little homeowner.and if you believe that you haven’t been paying attention; don’t worry though, there isn’t anything you can do too fix it, the average consumer has been destroyed and there isn’t anyway of bringing it back, you will not keep your home, you will not get it back, your credit is destroyed, the smart ones walked several years ago and already can qualify for a new loan on dirt cheap homes, and cash talks, so unless you are blessed with lots of cash or have someone dirty you can crawl in bed with to preserve your dream just forget it! the banks are not the only ones, what about the builders? you think they didn’t know the homes value were dropping when they were selling at top dollar? I just lost another family on my block, the prettiest house on the block, view, upgrades, taken care of until the last day of eviction, bank refused everything, couldn’t even approve sale prior to auction, they paid top dollar…………700,000+ maybe will get $200,000-220,000, homeowner got eviction, lost original home also, all monies invested in home, and now a broken home, marriage! they both worked and raised their children with morals, and this is what they got?Is pretty bad when you see grown men cry over investments that they just couldn’t keep,
In response to The Angry Jeweler, see: http://law.onecle.com/california/civil-procedure/726.html . http://www.avvo.com/legal-answers/can-ca-ccp-726-c–be-used-to-define-real-parties-o-318599.html may also be useful.
They get away with this because nobody knows you can pursue it this way.Sounds to me like once again they are playing with the law and us.The courts need to be the one to enforce this by holding the banks and most especially thier lawyers accountable for the reprehensible disregard they show for us and the law!!
Can anyone post the actual statute where this comes out of the California code? That would be extremely helpful. I could search the codes for comparable laws in other states. Obviously it comes from some sort of reason, something higher. I want to find it. Talk to me.