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

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

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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-Amended.html

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BILL NUMBER: SB 426	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 1, 2013

INTRODUCED BY   Senator Corbett

                        FEBRUARY 21, 2013

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



	LEGISLATIVE COUNSEL'S DIGEST


   SB 426, as amended, 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  ,  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
that was used to pay all or part of the purchase price of that
dwelling, occupied entirely or in part by the purchaser. For purposes
of subdivision (b), a loan described in this paragraph is a
"purchase money loan."
   (b) No deficiency  shall be owed or collected, and no
deficiency  judgment shall lie ,  on a loan, refinance,
or other credit transaction (collectively, a "credit transaction")
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") that is not applied to an obligation owed
or to be owed under the purchase money loan, or to fees, costs, or
related expenses of the credit transaction. A new credit transaction
shall be deemed to be a purchase money loan except as to the
principal amount of 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 a new advance, and interest payments shall be
applied to any interest due and owing. This subdivision applies only
to credit transactions that are executed on or after January 1, 2013.

   (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 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.  (a) No deficiency shall be owed or collected, and no
deficiency judgment shall 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 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.
   (b) This section does not apply to a deed of trust, 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).