If you’re just entering the world of buying a home in foreclosure, it’s important to understand the differences between a power-of-sale foreclosure and a no-power-of-sale foreclosure. In a power-of-sale foreclosure, you’ll find a power-of-sale clause in the existing mortgage or deed of trust. This clause details exactly what the process is in order to foreclose on a home. When you see this power-of-sale clause, a non-judicial foreclosure procedure is allowed. In order for a non-judicial disclosure to be processed, the loan default must be substantiated, and the borrower must be formally noticed through a notice of default.
If you don’t find a power-of-sale clause in the mortgage or deed of trust than a no-power-of-sale foreclosure process must be initiated. If the home is located in a state where judicial foreclosures are permitted, then the steps of a no-power-of-sale foreclosure must be followed.
If the property happens to be located in a non-judicial state or in a state which permits the lender to choose between the options of non-judicial or judicial foreclosure, the lender retains the right to decide which process they will use and must stick to the laws for that process. In most cases, a lender will prefer the non-judicial foreclosure process since it will save them money and time.
For some of the best non-judicial foreclosures in California, contact these Irvine Realtors to help you locate one.
