In 2021, SB1079 went into effect bringing drastic changes to CA’s nonjudicial foreclosure process in an attempt to encourage individual home ownership and affordable housing over entity property ownership. The idea was to bridge the gap at foreclosure sales between prospective homeowners and savvy investors by creating categories of “Eligible Bidders” with certain advantages.

Unfortunately, the structure highly incentivizes the unscrupulous to call themselves “Eligible Bidders” to gain these advantages over their competitors. AB1837 is an attempt to address this issue, and this webinar examined the potentially farreaching changes AB1837 brings to SB1079.

For AB1837, we discussed the following:

AB1837 redefines and clarifies several categories of entity Eligible Bidders, attempting to more closely tie them to affordable housing goals.
AB1837 implements a 30year (!) affordability covenant on properties acquired by Eligible Bidder entities at these foreclosure sales.
AB1837 establishes an enforcement mechanism through the Attorney General for related violations.

Finally, we briefly discussed the related AB2170 which requires entities that foreclose on over 175 properties a year to provide a 30day window for any REO listings in which only offers by certain Eligible Bidders may be accepted.

This webinar was hosted by Jacoby Perez, Esq., Attorney at Geraci LLP.

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