Notice of Default with Substitution of Trustee, which is used in California to formally initiate the non-judicial foreclosure process on a property. Here’s when and how it’s used:
When This Form Is Used
This form is used when:
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A homeowner (Trustor) has defaulted on their mortgage loan
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The lender (Beneficiary) wants to begin foreclosure proceedings
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The lender needs to appoint a new trustee to handle the foreclosure process
How This Form Is Used
The Two Main Components:
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NOTICE OF DEFAULT – The official start of foreclosure
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Informs the homeowner they are in default
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Specifies the amount owed to reinstate the loan
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Starts the legal foreclosure timeline
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SUBSTITUTION OF TRUSTEE – Appoints a new foreclosure trustee
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Replaces the original trustee with a new one (often a specialist in foreclosures)
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Gives the new trustee authority to conduct the foreclosure sale
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The Foreclosure Timeline in California:
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This Notice of Default is recorded – Starts the 3-month waiting period
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No sale can occur until 3 months after recording
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After 3 months – Trustee can schedule the foreclosure sale
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Sale must occur within 1 year of the Notice of Default (with some exceptions)
Homeowner’s Rights and Options:
The form outlines several important rights:
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Reinstatement Right – Homeowner can stop foreclosure by paying all past due amounts plus costs (up to 5 business days before the sale)
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Request Itemization – Can ask for a detailed breakdown of the amount owed
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Loan Modification – May negotiate alternative payment arrangements
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Sell the Property – Can still sell the property before the foreclosure is completed
Key Requirements:
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Contact Attempt – Lender must attempt to contact homeowner to discuss options (unless property is not owner-occupied)
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Multiple Language Notice – Includes notices in English, Chinese, Korean, Spanish, Tagalog, and Vietnamese
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Notarization – Must be properly notarized
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Recording – Must be recorded with the County Recorder
What Happens Next:
After this document is recorded:
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The 3-month waiting period begins
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The homeowner receives formal notice of the default
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The new trustee is authorized to proceed with the foreclosure
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The homeowner has approximately 3 months to cure the default before a sale date can be set
This is typically the first formal step in the California foreclosure process and represents a critical point where homeowners should seek legal advice or contact housing counselors to explore their options.
NOTICE OF DEFAULT WITH SUBSTITUTION OF TRUSTEE
(California Civil Code §2924c)
RECORDING REQUESTED BY:
AND WHEN RECORDED MAIL TO:
Name: _____________________________________________________
Street Address: _____________________________________________
City & State: _______________________________________________
SPACE ABOVE THIS LINE FOR RECORDER’S USE
IMPORTANT NOTICE
IF YOUR PROPERTY IS IN FORECLOSURE BECAUSE YOU ARE BEHIND IN YOUR PAYMENTS, IT MAY BE SOLD WITHOUT ANY COURT ACTION, and you may have the legal right to bring your account in good standing by paying all of your past due payments plus permitted costs and expenses within the time permitted by law for reinstatement of your account, which is normally five business days prior to the date set for the sale of your property. No sale date may be set until three months from the date this notice of default may be recorded.
This amount is $_____________________ as of ________, 20, and will increase until your account becomes current.
While your property is in foreclosure, you still must pay other obligations (such as insurance and taxes) required by your note and deed of trust or mortgage.
Upon your written request, the beneficiary or mortgagee will give you a written itemization of the entire amount you must pay.
To find out the amount you must pay, or to arrange for payment to stop the foreclosure, or if your property is in foreclosure for any other reason, contact:
Name of Beneficiary/Mortgagee: ________________________________
Mailing Address: _____________________________________________
Telephone: __________________________________________________
Pursuant to California Civil Code §2923.5, Beneficiary:
[ ] has contacted Owner and discussed avenues for refinance.
[ ] is unable to contact Owner after a due diligence effort.
[ ] is not required to contact Owner since Beneficiary’s record does not show the trust deed is secured by an owner-occupied, one-to-four unit primary residence.
If you have any questions, you should contact a lawyer or the governmental agency which may have insured your loan.
Remember, YOU MAY LOSE LEGAL RIGHTS IF YOU DO NOT TAKE PROMPT ACTION.
NOTICE IS HEREBY GIVEN:
Deed of Trust dated: _________________________________________
Executed by: _________________________________________________, as Trustor
In favor of: _________________________________________________, as Beneficiary
Recorded on: _____________________, as Instrument No.: __________
Official Records of: _________________________ County, California
Original note amount: $________________________________________
The beneficial interest under the Deed of Trust is held by the undersigned Beneficiary who
HEREBY APPOINTS _________________________________________ as Trustee under the Deed of Trust.
A default in the obligations secured by the Deed of Trust has occurred in that payment has not been made of:
Due to the default, the undersigned Beneficiary has signed and delivered to the Trustee a written Declaration of Default and Demand for Sale, and has deposited with the Trustee the Deed of Trust and all documents evidencing the secured obligations, and hereby declares all sums of the secured obligations immediately due and payable and elects to cause the real estate encumbered by the Deed of Trust to be sold to satisfy the secured obligations.
STATE OF CALIFORNIA
COUNTY OF _________________________________________________
On _________________________ before me, __________________________________________________
(Name and title of officer)
personally appeared ____________________________________________________________________,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature: ___________________________________________________
(Signature of notary public)
(This area for official notarial seal)
NOTE: THERE IS A SUMMARY OF THE INFORMATION IN THIS DOCUMENT ATTACHED
注：本文件包含一个信息摘要
참고사항: 본 첨부 문서에 정보 요약서가 있습니다
NOTA: SE ADJUNTA UN RESUMEN DE LA INFORMACIÓN DE ESTE DOCUMENTO
TALA: MAYROONG BUOD NG IMPORMASYON SA DOKUMENTONG ITO NA NAKALAKIP
LƯU Ý: KÈM THEO ĐÂY LÀ BẢN TRÌNH BÀY TÓM LƯỢC VỀ THÔNG TIN TRONG TÀI LIỆU NÀY
FORM COMPLETED BY:
Agent: ____________________________ Broker: ____________________________
Phone: _______________________ Email: _______________________
Disclaimer: This is a legal document. Consult with an attorney before use.
