Success is dependent on the goals of the plaintiff. The objective of gaining title to land free of any liens is rarely achieved, and has not been achieved in California. However, California debtors have used the action to remain in their homes for years after defaulting. (Ghervescu v. Wells Fargo Home Mortg., Inc., 2005 WL 6559918 (Dissolving preliminary injunction restraining trustee from delivering deed to winning purchaser at trustee’s sale).)
A wrongful foreclosure action alleges an “illegal, fraudulent or willfully oppressive sale of property under a power of sale contained in a mortgage or deed of trust.” (Munger v. Moore (1970) 11 Cal.App.3d. 1.) These actions work best when brought prior to the non-judicial foreclosure sale. To prevent the sale, the plaintiff must apply for an injunction and convince a judge that they are entitled to the injunction and that without it they will suffer irreparable harm. (Cal Code Civ. Pro § 526.) If the injunction is successful, the debtor can stay in the home for the duration of the lawsuit.
In Ghervescu v. Wells Fargo Home Mortg., Inc. (Cal. Ct. App., Nov. 16, 2010, E048925) 2010 WL 4621734, a borrower used the above procedural strategy to keep his house for over eight years after his default on the loan. After default, Ghervescu arranged a forbearance agreement with his lender, and some time shortly thereafter applied for a loan modification causing confusion with the lender. The lender failed to put the foreclosure proceedings on hold, and Ghervescu failed to make his payments on time.. The bank did not follow up on the pending application, and held a trustee’s sale prior to promised date of sale. Ghervescu quickly filed for a preliminary injunction to restrain the trustee from delivering the deed to the winning purchaser of the house at the trustee’s sale. The granted injunction prevented the foreclosure sale from constituting the final adjudication of the borrower’s rights. (See Smith v. Allen (1968) 68 Cal.2d 93, 96.) He lost at trial, and his motion to amend complaint and denied. The case bounced around through three trials and two appeals, finally ending in judgment for the bank.
- David Ambrose on James v. Recontrust (timothymccandless.wordpress.com)
- 2932.5 is dead in 2nd district they can’t read “or other encumbrance” (timothymccandless.wordpress.com)
- Roger Bernhardt on Calvo -D/T assignments need not be recorded pre foreclosure (timothymccandless.wordpress.com)
- WRONGFUL FORECLOSURE IN BANKRUPTCY (most bankruptcy judges won’t hear it the send you to state court) (timothymccandless.wordpress.com)
- MARK J. DEMUCHA AND CHERYL M. DEMUCHA, a brief that worked (timothymccandless.wordpress.com)
- The Trustee sale can be set aside (timothymccandless.wordpress.com)
- The San Fransico “Smoking Gun Report” (timothymccandless.wordpress.com)
- Audit Uncovers Extensive Flaws in Foreclosures (copy attached) (timothymccandless.wordpress.com)
- Phil Querin on the James Case in Oregon – two part commentary on the case included here…ruling attached. REQUIRED READING! (timothymccandless.wordpress.com)
- Foreclosure process is ‘utterly broken’ (timothymccandless.wordpress.com)