Non-Judicial Foreclosure

Non-judicial foreclosure is the primary method of foreclosure in California, commonly utilized by lenders when the mortgage note or deed of trust includes a "power-of-sale" clause. This provision permits the lender to sell the property and apply the profits towards the outstanding mortgage balance when the borrower defaults on the loan. As the name suggests, the foreclosure process does not involve a court hearing, but strict laws mandate lenders to furnish proof of mortgage ownership and borrower's default.

The foreclosure process commences with the lender issuing a Notice of Default, allowing the borrower 90 days to rectify the default. The trustee must also mail a copy of the notice of default to the borrower within 10 business days. Failure to rectify the default results in the lender filing a 21-day Notice of Trustee's Sale, culminating in the property being sold at an auction. However, the borrower has the option to cure the default until 5 days prior to the sale to stop the foreclosure.

Non-judicial foreclosure is preferred by many lenders as it is less time-consuming and less costly than judicial foreclosure. Unlike judicial foreclosure, non-judicial foreclosure does not provide borrowers with the right of redemption, which allows them to buy back the property after the sale.