Susan, Home Buyer in San Francisco, CA

Moratorium on foreclosures in California?

Asked by Susan, San Francisco, CA Mon Mar 2, 2009

In January and early febuary, I saw a slew of foreclosures and short sales come on the market in desirable areas of Contra Costa County. I havent seen many lately. I also heard that there is supposedly a 3 month moratorium specifically in California where banks cannot foreclose on someone.

Does anyone know what is really happening?

Help the community by answering this question:


Yes, California did adopt a new law as part of the state budget. It was a amendment authored by San Leandro State Senator Ellen Corbett. It doesn't affect everyone in foreclosure. And, since lenders can fairly easily qualify for an exemption, it may not ultimately affect that many. It's called the Foreclosure Prevention Act and actually extends the period of time before a lender can advertise a foreclosure sale by three months -- but only on your principal residence and only on loans that were recorded between Jan. 1, 2003 and Jan. 1, 2008.

I wrote an article in my blog about the new law ( ), where you'll find more details and even a link where you can read the actual bill that was signed into law.

Hope that helps answer your question!

- Rod Herman
Web Reference:
0 votes Thank Flag Link Mon Mar 2, 2009

There are currently 15 Active Forclosures/REO's in Alamo, Lafayette and Orinda.

Email me if you would like me to send them to you.
0 votes Thank Flag Link Thu Jun 18, 2009
Alamo, Lafayette, and Orinda...not the big foreclosure towns like Antioch.
0 votes Thank Flag Link Wed Jun 17, 2009
I am not sure which parts of Contra Costa County you would like to buy in. The moratorium will add 90 days to the previous three month 21 day period, before the trustee sale. We should be seeing the foreclosures from Nov,Dec,Jan,and Feb. hit the market in July and August. Working as a full time Realtor in East and Central Contra Costa County, I can provide some insight. There is about one and a half months of current inventory. During normal market conditions, Contra Costa County had 5-6 months inventory. If the banks were to flood the market with all four months of foreclosures we would have normal inventory. Of course this isn't going to happen. The Contra Costa County market is hot, and we all have more buyers then houses. The investors are buying everything in sight and the first time home buyers are wishing they could get there FHA offers accepted over the cash offers. When the inventory hits it will be absorbed by the first time homebuyers that haven't had a chance. I think East Contra Costa Counties prices will remain relatively stabile. The homes priced $450,000 and less in Central Contra County will stay stable. As more prime borrowers default, you will start to see some higher end homes become foreclosures. Which areas are you interested in? I will do my best to answer your questions.

Adrian Huntington
Coldwell Banker Coon & McCreary Realtors
1954 Contra Costa Blvd.
Pleasant Hill, CA 94523
0 votes Thank Flag Link Wed Jun 17, 2009
So does this mean the foreclosures wont come onto the market until Nov or Dec. vs. the end of the summer? I am also assuming this moratorium will further delay price drops.
0 votes Thank Flag Link Wed Jun 17, 2009
This is from the C.A.R. newsline.

Foreclosure Moratorium explained:

"Recent news headlines have caused confusion by mischaracterizing the new California Foreclosure Prevention Act as a “90-day moratorium” and incorrectly stating that the lender must modify delinquent loans before it begins foreclosure. In reality, the foreclosure process for certain owner-occupied residential first trust deeds has been extended by 90 days, effective June 15, but an exemption is available for lenders with comprehensive loan modification programs as defined by the Act.

Under pre-existing law, a lender must wait three months after filing a notice of default before it can file a notice of sale. The new California Foreclosure Prevention Act extending that time frame by another 90 days may not have much practical impact. "
0 votes Thank Flag Link Wed Jun 17, 2009
I have also heard this and I wish that the lenders would just let them go onto the market. With all of the multiple offer activity present on almost any listing below $500k right now one would think that there are enough buyers to absorb the extra inventory. When you see a bank repo in a nice location, I say grab it. You never know when another opportunity will be available.
0 votes Thank Flag Link Wed Jun 17, 2009
If you want to consider buying foreclosures, most good local Realtors are you best source. If you're interested in the East Bay, I can help you. If you're interested in San Francisco, I can't, but if that's what you want I can refer you to someone there if you'd like
0 votes Thank Flag Link Mon Mar 2, 2009
Do you know where I can find this info? Would it be realty trac or on trulia?
0 votes Thank Flag Link Mon Mar 2, 2009
Yes, more foreclosures will be coming. That is largely controlled by when and how many mortgages "reset" their rate and terms, which is publicly available information. It's the reset that triggers the increase in monthly mortgage payments that sends people into short sales or foreclosures.

I don't believe short sales are counted as foreclosures, nor were they included in the moratorium.
0 votes Thank Flag Link Mon Mar 2, 2009
So what happens after the moratorium? Will more foreclosures come on the market? Does this include short sales?
0 votes Thank Flag Link Mon Mar 2, 2009
Hi Susan,

The following is an excerpt on the subject from a story in the Feb. 14 Los Angeles Times

The moratorium announcements by big banks also followed pressure from Congress this week. At a meeting Wednesday of the House Financial Services Committee in which lawmakers chastised banking leaders for their role in the economic crisis, panel Chairman Rep. Barney Frank (D-Mass.) asked the CEOs to freeze foreclosures until the administration's mitigation effort was announced.

A number of the banks said Friday that they would honor Frank's request, most of them pledging to wait three weeks, until March 6, to see how the Obama plan would affect them.

In a letter to Frank, JPMorgan Chase & Co. Chief Executive Jamie Dimon said his firm was ready to work with the administration on an "appropriate process" for handling troubled borrowers, including a standardized loan modification program.

Other large mortgage customer-service firms signing on to a moratorium included Bank of America Corp., Wells Fargo & Co. and Citigroup Inc., as well as Fannie Mae and Freddie Mac, the mortgage-finance companies now controlled by the government.

The suspensions of foreclosures generally apply to single-family residences and small complexes of up to four units. Vacant homes are excluded.
The whole story can be found at,0…
0 votes Thank Flag Link Mon Mar 2, 2009
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