9.9 Earthquake in Default Servicing Turns California Into Judicial Foreclosure State - Mandelman Matters
2013-01-30 — ml-implode.com
It wasn't the law that had stopped Nevada's foreclosures so abruptly, it was the potential liability... the potential of being fined $5,000 and criminally charged if something weren't done right that had done it. I mean... what if I offered you $1200 to handle a foreclosure for me, but all of a sudden a state law made it potentially something that could end up costing me $5,000? How many would you want to do for $1200, if you could potentially lose $5,000 on each one? Not many, no question about it.
And California's HBR was much worse in terms of POTENTIAL liability... it could cost a party attempting to foreclose $50,000 under the worst of circumstances. And not only that, but California's HBR said that if the homeowner was granted a Temporary Restraining Order, or TRO, to stop a foreclosure or trustee sale... frankly something not all that difficult to do... then the homeowner would be awarded legal fees even if not awarded other damages... and that alone could be tens of thousands of dollars or even more.
"The only exemption from the HBR requirements, thus avoiding litigation and liability, is to file a Judicial Foreclosure on all first trust deeds on single family residences which are owner occupied."
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