Bill Text: CA SB426 | 2013-2014 | Regular Session | Introduced

California Senate Bill 426 (Prior Session Legislation)

NOTE: There are more recent revisions of this legislation. Read Latest Draft

Bill Title: Civil procedure: deficiency judgments.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2013-07-11 - Chaptered by Secretary of State. Chapter 65, Statutes of 2013. [SB426 Detail]

Download: California-2013-SB426-Introduced.html

BILL NUMBER: SB 426	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senator Corbett

                        FEBRUARY 21, 2013

   An act to amend Sections 580b and 580e of the Code of Civil
Procedure, relating to deficiency judgments.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 426, as introduced, Corbett. Civil procedure: deficiency
judgments.
   Existing law provides that no deficiency judgment shall lie
following a judicial foreclosure with respect to certain enumerated
circumstances, including, among others, after a sale of real property
or an estate for years therein for failure of the purchaser to
complete his or her contract of sale. Existing law prohibits a
judgment to be rendered for a deficiency on a note secured by a deed
of trust or mortgage on real property or an estate for years therein,
as specified.
   This bill would prohibit a deficiency from being owed or collected
following a judicial foreclosure with respect to the enumerated
circumstances. The bill also would prohibit a deficiency from being
owed or collected for a deficiency on a note secured by a deed of
trust or mortgage on real property or an estate for years therein, as
specified, and would make nonsubstantive changes to these
provisions.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 580b of the Code of Civil Procedure is amended
to read:
   580b.  (a) No deficiency  shall be owed or collected, and no
deficiency  judgment shall lie  in any event 
for  any of  the following:
   (1) After a sale of real property or an estate for years therein
for failure of the purchaser to complete his or her contract of sale.

   (2) Under a deed of trust or mortgage given to the vendor to
secure payment of the balance of the purchase price of that real
property or estate for years therein.
   (3) Under a deed of trust or mortgage on a dwelling for not more
than four families given to a lender to secure repayment of a loan
 which   that  was  in fact
 used to pay all or part of the purchase price of that
dwelling, occupied entirely or in part by the purchaser.
    (b)    For purposes of
subdivision  (c),   (b),  a loan described
in  this  paragraph  (3) of subdivision (a)
 is a "purchase money loan." 
   (c) 
    (b)  No deficiency judgment shall lie  in any
event  on  any   a  loan,
refinance, or other credit transaction (collectively, a "credit
transaction")  which   that  is used to
refinance a purchase money loan, or subsequent refinances of a
purchase money loan, except to the extent that in a credit
transaction  ,  the lender or creditor advances new
principal (hereafter "new advance")  which  
that  is not applied to  any   an 
obligation owed or to be owed under the purchase money loan, or to
fees, costs, or related expenses of the credit transaction. 
Any   A  new credit transaction shall be deemed to
be a purchase money loan except as to the principal amount of
 any   a  new advance. For purposes of this
section, any payment of principal shall be deemed to be applied
first to the principal balance of the purchase money loan, and then
to the principal balance of  any   a  new
advance, and interest payments shall be applied to any interest due
and owing.  The provisions of this  This 
subdivision  shall   applies  only 
apply  to credit transactions that are executed on or after
January 1, 2013. 
   (d) Where 
    (c)     When  both a chattel mortgage
and a deed of trust or mortgage have been given to secure payment of
the balance of the combined purchase price of both real and personal
property, no deficiency judgment shall lie  at any time
 under any one thereof if no deficiency judgment would lie
under the deed of trust or mortgage on the real property or estate
for years therein.
  SEC. 2.  Section 580d of the Code of Civil Procedure is amended to
read:
   580d.   No   (a)     No
deficiency shall be owed or collected, and no deficiency 
judgment shall be rendered for  any   a 
deficiency  upon   on  a note secured by a
deed of trust or mortgage  upon   on  real
property or an estate for years therein  hereafter 
executed in any case in which the real property or estate for years
therein has been sold by the mortgagee or trustee under power of sale
contained in the mortgage or deed of trust. 
   This 
    (b)     This  section does not apply
to  any   a  deed of trust, 
mortgage   mortgage,  or other lien given to secure
the payment of bonds or other evidences of indebtedness authorized
or permitted to be issued by the Commissioner of Corporations, or
which is made by a public utility subject to the Public Utilities Act
(Part 1 (commencing with Section 201) of Division 1 of the Public
Utilities Code).