Mortgage defaults: secondary public financing.

Existing law requires a lender to file a notice of default in the case of nonjudicial foreclosure prior to enforcing a power of sale as a result of a default on an obligation secured by real property, as specified. Existing law also requires that a notice of sale be given before the power of sale may be exercised. This bill would, until 2013, create an exception to the provision governing the exercise of the power of sale by providing that if a property contains 5 or more multifamily units and a public entity, as defined, is a party to a regulatory agreement or recorded deed restriction on the property, the public entity may, by written notice to the trustee, postpone the sale date by no more than 60 days, as specified. The bill would provide that, if multiple public entities are parties to a regulatory agreement or a recorded deed restriction on the property, only one entity may postpone the sale date. The bill would also provide that the power to postpone a sale date pursuant to these provisions may be exercised only once, and that the period of postponement expires after 180 days have elapsed since filing the notice of default.