Updated: 3 days ago
California Civil Code, CIV § 2924f(b)(8)(A) requires public recording in the county clerk's office as well as newspaper pub-lication of a formal notice of a trustee’s sale, with the foreclosure auction time, date & place, also advertising what is being sold by allegedly authorized parties, i.e., stated as follows:
"You will be bidding on a LIEN, not on the property itself. Placing the highest bid at a trustee auction does NOT automatically entitle you to free and clear ownership of the property."
(emphasis added - see link below for entire code)
So... the winning bidder at a foreclosure auction does NOT TAKE "TITLE TO THE PROPERTY ITSELF?" What good is taking just a "LIEN?"
Surely ... that still means the winning bidder owns the house, right? RIGHT???
California Civil Code, CIV § 2888 reads: "Notwithstanding an agreement to the contrary, a lien, or a contract for a lien, transfers no title to the property subject to the lien."
But .. why in the world would they do that??
Because if a homeowner could actually be stripped of title ownership of their real property and home, from the mere filing of a few often forged, fraudulent and fabricated documents which escape any judge's scrutiny or any court process along the way, as well as unchecked by any process of scrutiny by county clerk recorder office, then the entire "2924 scheme" of nonjudicial foreclosures in California would be subject to a massive Constitutional Challenge, and lose. That's why.
For further study see: "California's Nonjudicial Foreclosure Two-Step Should be Danced to the Right Tune", (excerpt image below). Author: Robert N. Janes, http://www.esprouts.com/ebud-store.php.
Check the disclaimers in any California Notice of Trustee Sale usually on page 2 below the signature of the person who executed it and you will find the above NOTICE to bidders as required caveat and warning that "title" to the real property is explicitly NOT being conveyed and that merely a "lien" explicitly is the only interest being sold at trustee sale.
Additionally also find on the same document usually on page 1 that the substituted trustee who executes the Notice of Trustee Sale also warns all bidders: "Said sale will be made, but without covenant or warranty, expressed or implied, regarding title, possession, or encumbrances." The "Nemo Dat" rule alongside rules and exceptions for "Bona fide purchaser" come into play. HENCE WRITTEN NOTICE AND DISCLAIMERS ARE TANTAMOUNT for the substitute trustee law firm to protect itself from suit.
See below for discussion of "Notice" and "Bona fide purchaser"
Yes there are protections for "bona fide purchasers for value without notice."
But it must first prove beyond a shadow of a doubt that it was indeed "without notice."
So, if the homeowner attends the auction and gives clear VERBAL NOTICE of complex controversy over title for all attending to hear, there can be no "bona fide purchaser" in attendance at that auction if the agent for the winning bidder heard your verbal warning. That winning bidder is formally noticed with your appropriate TRUE verbal warnings, such as "I am the homeowner who IS IN LAWFUL POSSESSION and I know my legal rights: I have and I will exercise my right to defend against this illegal auction on my home. You are all noticed now and any winning bidder is NOT a "bona fide purchaser" here today because this IS my verbal NOTICE. Warning you should avoid getting entangled in complex protracted litigation with the homeowner, myself: You are HEREBY DULY NOTICED."
If there is no third party winning bidder and the lien "reverts back to the beneficiary" then that "beneficiary" is not a bona fide purchaser because it was already NOTICED of controversy before auction which homeowner may evidence by communications which notice the mortgage-servicer and any attorneys of fatal defects in the chain of title or such things as fraud, forgery, defective assignments, violations of mortgage servicing duties, etc.; so the same should be well aware of homeowner's good faith attempts to resolve by an alternative that results in keeping possession of home (negotiation, offers, ongoing lawsuit, loan modification, outside refinance etc.). Therefore when the lien "reverts back to the beneficiary" there is no "bona fide purchaser for value without notice."