Everyone interested in real estate has heard by now that Bank of America has temporarily suspended all foreclosures in the country, and other banks have suspended foreclosures in states that have judicial foreclosures (like Florida). I’ve been asked over the past few days how and if this affects us in California. The short answer is – not really. Here’s the rest of the story…

About half the states in the country (23) do foreclosures through the courts – called a judicial foreclosure. The other states – including California – have established statutory rules and procedures that don’t involve the (overloaded) court system. Thus the Florida court system is completely overwhelmed with foreclosures and has had to establish special “Rocket Docket” courts to try and mitigate the backlog.

The issue is: Has the lender followed these laws and procedures?

California requires a declaration signed by a representative of the lender that the lender has contacted the homeowner (or at least tried to) and to “explore options for the borrower to avoid foreclosure”.

The media states that “robo-signers” were signing these declarations by the thousands. May so, maybe not, but foreclosures will continue unabated in California.