Step-by-Step Guide
Stop Foreclosure by Selling Your California Home
Protect your credit, avoid deficiency judgments, and move forward with a cash sale before the foreclosure process completes.
Facing foreclosure is stressful, but you have more options than you might realize. In California, the foreclosure process takes at least 120 days, giving you time to sell your home and pay off your mortgage before the bank takes action.
Selling to a cash buyer can be the fastest way to stop foreclosure, protect your credit score, and potentially walk away with money in your pocket. This guide explains your options and timeline.
Key Takeaways
- California foreclosure takes at least 120 days, giving you time to sell
- Selling protects your credit better than foreclosure or short sale
- Cash buyers can close in 7-14 days to beat foreclosure deadlines
- You may walk away with equity even in a distressed situation
- Contact your lender early to understand your options
Step-by-Step Process
Understand Your Timeline
California is a non-judicial foreclosure state. After you miss payments, your lender must wait 30 days to file a Notice of Default, then 90 days before filing a Notice of Sale, then at least 21 days before the auction. This gives you at least 120 days from the first missed payment.
Calculate Your Equity Position
Determine what you owe on your mortgage(s) versus the current market value. If you have equity, selling allows you to pay off the loan and keep the difference. If you're underwater, you may need lender approval for a short sale.
Contact Your Lender
Inform your lender that you intend to sell. They may be willing to pause foreclosure proceedings if you can demonstrate you're actively marketing the property. Some lenders offer a grace period for short sales.
Get a Cash Offer
Traditional sales with financing can take 30-45 days to close, which may not fit your timeline. Cash buyers like MeritHomeBuyers can close in as little as 7 days, giving you the speed you need to beat foreclosure deadlines.
Close Before the Auction
Work with escrow to ensure the sale closes and the lender is paid off before the auction date. In California, you can cancel a foreclosure sale up until 5 days before the scheduled date if the loan is fully paid.
What You'll Need
“After losing my job, I fell behind on payments and got a Notice of Default. MeritHomeBuyers gave me a fair offer and closed in 10 days, two weeks before the auction. I paid off my mortgage and walked away with enough to get back on my feet.”
Robert K.
Facing foreclosure after job loss
Frequently Asked Questions
Can I sell my house after receiving a Notice of Default?
Yes. You can sell your home at any point before the foreclosure auction is complete. The sooner you act, the more options you have. A cash sale can close quickly enough to beat most foreclosure timelines.
What if I owe more than my house is worth?
If you're underwater, you may need to do a short sale, which requires lender approval. We can help you navigate this process. In some cases, we can negotiate with your lender on your behalf.
Will selling affect my credit less than foreclosure?
Yes. A traditional sale or even a short sale typically impacts your credit less than a completed foreclosure. Foreclosure can stay on your credit report for 7 years and drop your score by 100-150 points.
What happens to my equity if I sell?
After paying off your mortgage and closing costs, any remaining equity is yours. Many homeowners are surprised to find they have more equity than expected, especially in California's market.
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Facing foreclosure?
Get a cash offer within 24 hours and close before your auction date. We can help you protect your credit and move forward.