Archive for March 16th, 2023

Understanding California’s New Foreclosure Laws: What Investors Need to Know

Posted on March 16, 2023. Filed under: Foreclosure Assistance, Orange County CA Foreclosures | Tags: , , , |

Investing in real estate has always been a lucrative opportunity for those looking to build their wealth. One of the more popular ways to invest in real estate is through purchasing auction properties, which are typically sold at a discount. However, if you are an investor looking to purchase an auction property in California, it’s important to be aware of the new foreclosure laws that have been put in place.

New Foreclosure Laws in California Give Tenants and Former Homeowners More Power in the Auction Property Market

In California, new laws have recently been passed that give tenants and former homeowners the right to redeem foreclosed properties after they go up for auction. These laws, mainly AB 1837 and SB 1079, are designed to provide additional protections for homeowners facing foreclosure.

Under this new law, if a property is foreclosed upon and is set to be sold at auction, the tenant and former owner have the right to match the highest bid at the auction. This means that if you are an investor looking to purchase an auction property in California, you may be outbid by the tenant or former owner.

This new law is significant because it gives tenants and former homeowners more power in the foreclosure process. Prior to this law, tenants and former homeowners had very little say in the matter and were often left out of the process entirely. This meant that investors had a much easier time purchasing auction properties in California, as they faced less competition.

As an investor looking to purchase an auction property in California, it’s important to understand the implications of this new law. While it does make it more difficult for investors to purchase auction properties, it also means that there may be less competition overall. Additionally, it’s important to keep in mind that this law only applies to foreclosed properties that are sold at auction. If you are interested in purchasing a non-foreclosed property, you will not be subject to these new regulations.

Overall, the new foreclosure laws in California are important for investors who are devising a strategy for purchasing auction properties. It will be very different than our last real estate cycle. While it may make the process more challenging, it also provides additional protections for tenants and former homeowners. As with any investment, it’s important to do your due diligence and understand all of the relevant laws and regulations before making a purchase.

If you’re an investor looking to navigate California’s new foreclosure laws, it’s crucial to have a thorough understanding of the Assembly Bill (AB) 1837. To ensure that you’re up to date with the latest rules and regulations, we strongly advise you to read up on the full details by visiting trusted sources. By taking this step, you’ll be equipped with the knowledge you need to make informed decisions and avoid costly mistakes.

A very important part to note in the bill is that trustees are authorized to consider offers from specific categories of eligible bidders during the first 30 days of a property’s listing, including:

  • prospective owner-occupants,
  • nonprofit corporations,
  • California community land trusts,
  • limited-equity housing operatives, and
  • public entities

New Foreclosure Law in California Prohibits Bundling of Homes, Affecting Investors in Auction Property Market

In addition, according to SB 1079, during a foreclosure auction, sellers are prohibited from bundling homes together and selling them to a single buyer. Because foreclosure sales cannot be ‘bundled’ and sold in large groups anymore, that will also be a big change investors need to know about.

If you’re interested in purchasing an auction or foreclosure property, call or text Angie at 949-338-7408 or fill out the form below. We have a wide range of properties available, and we’re always happy to provide guidance and support to investors like you. Don’t hesitate though to reach out to us for assistance with your next real estate investment.

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