WAIS Document Retrieval

CALI FORNI A CODES

CIVIL CODE
SECTI ON 2945- 2945. 11
2945. ( a) The Legi sl at ur e f i nds and decl ar es t hat homeowner s whose
r esi dences ar e i n f or ecl osur e ar e subj ect t o f r aud, decept i on,
har assment , and unf ai r deal i ng by f or ecl osur e consul t ant s f r omt he
t i me a Not i ce of Def aul t i s r ecor ded pur suant t o Sect i on 2924 unt i l
t he t i me sur pl us f unds f r omany f or ecl osur e sal e ar e di st r i but ed t o
t he homeowner or hi s or her successor . For ecl osur e consul t ant s
r epr esent t hat t hey can assi st homeowner s who have def aul t ed on
obl i gat i ons secur ed by t hei r r esi dences. These f or ecl osur e
consul t ant s, however , of t en char ge hi gh f ees, t he payment of whi ch i s
of t en secur ed by a deed of t r ust on t he r esi dence t o be saved, and
per f or mno ser vi ce or essent i al l y a wor t hl ess ser vi ce. Homeowner s,
r el yi ng on t he f or ecl osur e consul t ant s' pr omi ses of hel p, t ake no
ot her act i on, ar e di ver t ed f r oml awf ul busi nesses whi ch coul d r ender
benef i ci al ser vi ces, and of t en l ose t hei r homes, somet i mes t o t he
f or ecl osur e consul t ant s who pur chase homes at a f r act i on of t hei r
val ue bef or e t he sal e. Vul ner abl e homeowner s ar e i ncr easi ngl y
r el yi ng on t he ser vi ces of f or ecl osur e consul t ant s who advi se t he
homeowner t hat t he f or ecl osur e consul t ant can obt ai n t he r emai ni ng
f unds f r omt he f or ecl osur e sal e i f t he homeowner execut es an
assi gnment of t he sur pl us, a deed, or a power of at t or ney i n f avor of
t he f or ecl osur e consul t ant . Thi s r esul t s i n t he homeowner payi ng an
exor bi t ant f ee f or a ser vi ce when t he homeowner coul d have obt ai ned
t he r emai ni ng f unds f r omt he t r ust ee' s sal e f r omt he t r ust ee di r ect l y
f or mi ni mal cost i f t he homeowner had consul t ed l egal counsel or had
suf f i ci ent t i me t o r ecei ve not i ces f r omt he t r ust ee pur suant t o
Sect i on 2924j r egar di ng how and wher e t o make a cl ai mf or excess
pr oceeds.
( b) The Legi sl at ur e f ur t her f i nds and decl ar es t hat f or ecl osur e
consul t ant s have a si gni f i cant i mpact on t he economy of t hi s st at e
and on t he wel f ar e of i t s ci t i zens.
( c) The i nt ent and pur poses of t hi s ar t i cl e ar e t he f ol l owi ng:
( 1) To r equi r e t hat f or ecl osur e consul t ant ser vi ce agr eement s be
expr essed i n wr i t i ng; t o saf eguar d t he publ i c agai nst decei t and
f i nanci al har dshi p; t o per mi t r esci ssi on of f or ecl osur e consul t at i on
cont r act s; t o pr ohi bi t r epr esent at i ons t hat t end t o mi sl ead; and t o
encour age f ai r deal i ng i n t he r endi t i on of f or ecl osur e ser vi ces.
( 2) The pr ovi si ons of t hi s ar t i cl e shal l be l i ber al l y const r ued t o
ef f ect uat e t hi s i nt ent and t o achi eve t hese pur poses.
2945. 1. The f ol l owi ng def i ni t i ons appl y t o t hi s chapt er :
( a) " For ecl osur e consul t ant " means any per son who makes any
sol i ci t at i on, r epr esent at i on, or of f er t o any owner t o per f or mf or
compensat i on or who, f or compensat i on, per f or ms any ser vi ce whi ch t he
per son i n any manner r epr esent s wi l l i n any manner do any of t he
f ol l owi ng:
( 1) St op or post pone t he f or ecl osur e sal e.
( 2) Obt ai n any f or bear ance f r omany benef i ci ar y or mor t gagee.
( 3) Assi st t he owner t o exer ci se t he r i ght of r ei nst at ement
pr ovi ded i n Sect i on 2924c.
( 4) Obt ai n any ext ensi on of t he per i od wi t hi n whi ch t he owner may
r ei nst at e hi s or her obl i gat i on.
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( 5) Obt ai n any wai ver of an accel er at i on cl ause cont ai ned i n any
pr omi ssor y not e or cont r act secur ed by a deed of t r ust or mor t gage on
a r esi dence i n f or ecl osur e or cont ai ned t hat deed of t r ust or
mor t gage.
( 6) Assi st t he owner t o obt ai n a l oan or advance of f unds.
( 7) Avoi d or amel i or at e t he i mpai r ment of t he owner ' s cr edi t
r esul t i ng f r omt he r ecor di ng of a not i ce of def aul t or t he conduct of
a f or ecl osur e sal e.
( 8) Save t he owner ' s r esi dence f r omf or ecl osur e.
( 9) Assi st t he owner i n obt ai ni ng f r omt he benef i ci ar y, mor t gagee,
t r ust ee under a power of sal e, or counsel f or t he benef i ci ar y,
mor t gagee, or t r ust ee, t he r emai ni ng pr oceeds f r omt he f or ecl osur e
sal e of t he owner ' s r esi dence.
( b) A f or ecl osur e consul t ant does not i ncl ude any of t he
f ol l owi ng:
( 1) A per son l i censed t o pr act i ce l aw i n t hi s st at e when t he
per son r ender s ser vi ce i n t he cour se of hi s or her pr act i ce as an
at t or ney at l aw.
( 2) A per son l i censed under Di vi si on 3 ( commenci ng wi t h Sect i on
12000) of t he Fi nanci al Code when t he per son i s act i ng as a pr or at er
as def i ned t her ei n.
( 3) A per son l i censed under Par t 1 ( commenci ng wi t h Sect i on 10000)
of Di vi si on 4 of t he Busi ness and Pr of essi ons Code when t he per son
makes a di r ect l oan or when t he per son ( A) engages i n act s whose
per f or mance r equi r es l i censur e under t hat par t , ( B) i s ent i t l ed t o
compensat i on f or t he act s per f or med i n connect i on wi t h t he sal e of a
r esi dence i n f or ecl osur e or wi t h t he ar r angi ng of a l oan secur ed by a
l i en on a r esi dence i n f or ecl osur e, ( C) does not cl ai m, demand,
char ge, col l ect , or r ecei ve any compensat i on unt i l t he act s have been
per f or med or cannot be per f or med because of an owner ' s f ai l ur e t o
make t he di scl osur es set f or t h i n Sect i on 10243 of t he Busi ness and
Pr of essi ons Code or f ai l ur e t o accept an of f er f r oma pur chaser or
l ender r eady, wi l l i ng, and abl e t o pur chase a r esi dence i n
f or ecl osur e or make a l oan secur ed by a l i en on a r esi dence i n
f or ecl osur e on t he t er ms pr escr i bed i n a l i st i ng or a l oan agr eement ,
and ( D) does not acqui r e any i nt er est i n a r esi dence i n f or ecl osur e
di r ect l y f r oman owner f or whomt he per son agr eed t o per f or mt he act s
ot her t han as a t r ust ee or benef i ci ar y under a deed of t r ust gi ven
t o secur e t he payment of a l oan or t hat compensat i on. For t he
pur poses of t hi s par agr aph, a " di r ect l oan" means a l oan of a r eal
est at e br oker ' s own f unds secur ed by a deed of t r ust on t he r esi dence
i n f or ecl osur e, whi ch l oan and deed of t r ust t he br oker i n good
f ai t h at t empt s t o assi gn t o a l ender , f or an amount at l east
suf f i ci ent t o cur e al l of t he def aul t s on obl i gat i ons whi ch ar e t hen
subj ect t o a r ecor ded not i ce of def aul t , pr ovi ded t hat , i f a
f or ecl osur e sal e i s conduct ed wi t h r espect t o t he deed of t r ust , t he
per son conduct i ng t he f or ecl osur e sal e has no i nt er est i n t he
r esi dence i n f or ecl osur e or i n t he out come of t he sal e and i s not
owned, cont r ol l ed, or managed by t he l endi ng br oker ; t he l endi ng
br oker does not acqui r e any i nt er est i n t he r esi dence i n f or ecl osur e
di r ect l y f r omt he owner ot her t han as a benef i ci ar y under t he deed of
t r ust ; and t he l oan i s not made f or t he pur pose or ef f ect of
avoi di ng or evadi ng t he pr ovi si ons of t hi s ar t i cl e.
( 4) A per son l i censed under Chapt er 1 ( commenci ng wi t h Sect i on
5000) of Di vi si on 3 of t he Busi ness and Pr of essi ons Code when t he
per son i s act i ng i n any capaci t y f or whi ch t he per son i s l i censed
under t hose pr ovi si ons.
( 5) A per son or hi s or her aut hor i zed agent act i ng under t he
expr ess aut hor i t y or wr i t t en appr oval of t he Depar t ment of Housi ng
and Ur ban Devel opment or ot her depar t ment or agency of t he Uni t ed















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St at es or t hi s st at e t o pr ovi de ser vi ces.
( 6) A per son who hol ds or i s owed an obl i gat i on secur ed by a l i en
on any r esi dence i n f or ecl osur e when t he per son per f or ms ser vi ces i n
connect i on wi t h t hi s obl i gat i on or l i en.
( 7) Any per son l i censed t o make l oans pur suant t o Di vi si on 9
( commenci ng wi t h Sect i on 22000) , 10 ( commenci ng wi t h Sect i on 24000) ,
or 11 ( commenci ng wi t h Sect i on 26000) of t he Fi nanci al Code, subj ect
t o t he aut hor i t y of t he Commi ssi oner of Cor por at i ons t o t er mi nat e
t hi s excl usi on, af t er not i ce and hear i ng, f or any per son l i censed
pur suant t o any of t hose di vi si ons upon a f i ndi ng t hat t he l i censee
i s f ound t o have engaged i n pr act i ces descr i bed i n subdi vi si on ( a) of
Sect i on 2945.
( 8) Any per son or ent i t y doi ng busi ness under any l aw of t hi s
st at e, or of t he Uni t ed St at es r el at i ng t o banks, t r ust compani es,
savi ngs and l oan associ at i ons, i ndust r i al l oan compani es, pensi on
t r ust s, cr edi t uni ons, i nsur ance compani es, or any per son or ent i t y
aut hor i zed under t he l aws of t hi s st at e t o conduct a t i t l e or escr ow
busi ness, or a mor t gagee whi ch i s a Uni t ed St at es Depar t ment of
Housi ng and Ur ban Devel opment appr oved mor t gagee and any subsi di ar y
or af f i l i at e of t he above, and any agent or empl oyee of t he above
whi l e engaged i n t he busi ness of t hese per sons or ent i t i es.
( 9) A per son l i censed as a r esi dent i al mor t gage l ender or ser vi cer
pur suant t o Di vi si on 20 ( commenci ng wi t h Sect i on 50000) of t he
Fi nanci al Code, when act i ng under t he aut hor i t y of t hat l i cense.
( c) Not wi t hst andi ng subdi vi si on ( b) , any per son who pr ovi des
ser vi ces pur suant t o par agr aph ( 9) of subdi vi si on ( a) i s a
f or ecl osur e consul t ant unl ess he or she i s t he owner ' s at t or ney.
( d) " Per son" means any i ndi vi dual , par t ner shi p, cor por at i on,
l i mi t ed l i abi l i t y company, associ at i on or ot her gr oup, however
or gani zed.
( e) " Ser vi ce" means and i ncl udes, but i s not l i mi t ed t o, any of
t he f ol l owi ng:
( 1) Debt , budget , or f i nanci al counsel i ng of any t ype.
( 2) Recei vi ng money f or t he pur pose of di st r i but i ng i t t o
cr edi t or s i n payment or par t i al payment of any obl i gat i on secur ed by
a l i en on a r esi dence i n f or ecl osur e.
( 3) Cont act i ng cr edi t or s on behal f of an owner of a r esi dence i n
f or ecl osur e.
( 4) Ar r angi ng or at t empt i ng t o ar r ange f or an ext ensi on of t he
per i od wi t hi n whi ch t he owner of a r esi dence i n f or ecl osur e may cur e
hi s or her def aul t and r ei nst at e hi s or her obl i gat i on pur suant t o
Sect i on 2924c.
( 5) Ar r angi ng or at t empt i ng t o ar r ange f or any del ay or
post ponement of t he t i me of sal e of t he r esi dence i n f or ecl osur e.
( 6) Advi si ng t he f i l i ng of any document or assi st i ng i n any manner
i n t he pr epar at i on of any document f or f i l i ng wi t h any bankr upt cy
cour t .
( 7) Gi vi ng any advi ce, expl anat i on or i nst r uct i on t o an owner of a
r esi dence i n f or ecl osur e whi ch i n any manner r el at es t o t he cur e of
a def aul t i n or t he r ei nst at ement of an obl i gat i on secur ed by a l i en
on t he r esi dence i n f or ecl osur e, t he f ul l sat i sf act i on of t hat
obl i gat i on, or t he post ponement or avoi dance of a sal e of a r esi dence
i n f or ecl osur e pur suant t o a power of sal e cont ai ned i n any deed of
t r ust .
( 8) Ar r angi ng or at t empt i ng t o ar r ange f or t he payment by t he
benef i ci ar y, mor t gagee, t r ust ee under a power of sal e, or counsel f or
t he benef i ci ar y, mor t gagee, or t r ust ee, of t he r emai ni ng pr oceeds t o
whi ch t he owner i s ent i t l ed f r oma f or ecl osur e sal e of t he owner ' s
r esi dence i n f or ecl osur e. Ar r angi ng or at t empt i ng t o ar r ange f or t he
payment shal l i ncl ude any ar r angement wher e t he owner t r ansf er s or



















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assi gns t he r i ght t o t he r emai ni ng pr oceeds of a f or ecl osur e sal e t o
t he f or ecl osur e consul t ant or any per son desi gnat ed by t he
f or ecl osur e consul t ant , whet her t hat t r ansf er i s ef f ect ed by
agr eement , assi gnment , deed, power of at t or ney, or assi gnment of
cl ai m.
( f ) " Resi dence i n f or ecl osur e" means a r esi dence i n f or ecl osur e as
def i ned i n Sect i on 1695. 1.
( g) " Owner " means a pr oper t y owner as def i ned i n Sect i on 1695. 1.
( h) " Cont r act " means any agr eement , or any t er mt her eof , bet ween a
f or ecl osur e consul t ant and an owner f or t he r endi t i on of any ser vi ce
as def i ned i n subdi vi si on ( e) .
2945. 2. ( a) I n addi t i on t o any ot her r i ght under l aw t o r esci nd a
cont r act , an owner has t he r i ght t o cancel such a cont r act unt i l
mi dni ght of t he t hi r d " busi ness day" as def i ned i n subdi vi si on ( e) of
Sect i on 1689. 5 af t er t he day on whi ch t he owner si gns a cont r act
whi ch compl i es wi t h Sect i on 2945. 3.
( b) Cancel l at i on occur s when t he owner gi ves wr i t t en not i ce of
cancel l at i on t o t he f or ecl osur e consul t ant at t he addr ess speci f i ed
i n t he cont r act .
( c) Not i ce of cancel l at i on, i f gi ven by mai l , i s ef f ect i ve when
deposi t ed i n t he mai l pr oper l y addr essed wi t h post age pr epai d.
( d) Not i ce of cancel l at i on gi ven by t he owner need not t ake t he
par t i cul ar f or mas pr ovi ded wi t h t he cont r act and, however expr essed,
i s ef f ect i ve i f i t i ndi cat es t he i nt ent i on of t he owner not t o be
bound by t he cont r act .
2945. 2. ( a) I n addi t i on t o any ot her r i ght under l aw t o r esci nd a
cont r act , an owner has t he r i ght t o cancel such a cont r act unt i l
mi dni ght of t he f i f t h busi ness day, as def i ned i n subdi vi si on ( e) of
Sect i on 1689. 5, af t er t he day on whi ch t he owner si gns a cont r act
t hat compl i es wi t h Sect i on 2945. 3.
( b) Cancel l at i on occur s when t he owner gi ves wr i t t en not i ce of
cancel l at i on t o t he f or ecl osur e consul t ant by mai l at t he addr ess
speci f i ed i n t he cont r act , or by f acsi mi l e or el ect r oni c mai l at t he
number or addr ess i dent i f i ed i n t he cont r act .
( c) Not i ce of cancel l at i on, i f gi ven by mai l , i s ef f ect i ve when
deposi t ed i n t he mai l pr oper l y addr essed wi t h post age pr epai d. I f
gi ven by f acsi mi l e or el ect r oni c mai l , not i ce of cancel l at i on i s
ef f ect i ve when successf ul l y t r ansmi t t ed.
( d) Not i ce of cancel l at i on gi ven by t he owner need not t ake t he
par t i cul ar f or mas pr ovi ded wi t h t he cont r act and, however expr essed,
i s ef f ect i ve i f i t i ndi cat es t he i nt ent i on of t he owner not t o be
bound by t he cont r act .
( a) Ever y cont r act shal l be i n wr i t i ng and shal l f ul l y 2945. 3.
di scl ose t he exact nat ur e of t he f or ecl osur e consul t ant ' s ser vi ces
and t he t ot al amount and t er ms of compensat i on.
( b) The f ol l owi ng not i ce, pr i nt ed i n at l east 14- poi nt bol df ace
t ype and compl et ed wi t h t he name of t he f or ecl osur e consul t ant , shal l
be pr i nt ed i mmedi at el y above t he st at ement r equi r ed by subdi vi si on
( c) :
" NOTI CE REQUI RED BY CALI FORNI A LAW
Operative until July 1, 2009
Operative July 1, 2009
Operative until July 1, 2009











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_____________________________ or anyone wor ki ng
( Name)
f or hi mor her CANNOT:
( 1) Take any money f r omyou or ask you f or money
unt i l ________________________________________ has
( Name)
compl et el y f i ni shed doi ng ever yt hi ng he or she
sai d he or she woul d do; and
( 2) Ask you t o si gn or have you si gn any l i en,
deed of t r ust , or deed. "
( c) The cont r act shal l be wr i t t en i n t he same l anguage as
pr i nci pal l y used by t he f or ecl osur e consul t ant t o descr i be hi s or her
ser vi ces or t o negot i at e t he cont r act ; shal l be dat ed and si gned by
t he owner ; and shal l cont ai n i n i mmedi at e pr oxi mi t y t o t he space
r eser ved f or t he owner ' s si gnat ur e a conspi cuous st at ement i n a si ze
equal t o at l east 10- poi nt bol df ace t ype, as f ol l ows: " You, t he
owner , may cancel t hi s t r ansact i on at any t i me pr i or t o mi dni ght of
t he t hi r d busi ness day af t er t he dat e of t hi s t r ansact i on. See t he
at t ached not i ce of cancel l at i on f or mf or an expl anat i on of t hi s
r i ght . "
( d) The cont r act shal l cont ai n on t he f i r st page, i n a t ype si ze
no smal l er t han t hat gener al l y used i n t he body of t he document , each
of t he f ol l owi ng:
( 1) The name and addr ess of t he f or ecl osur e consul t ant t o whi ch
t he not i ce or cancel l at i on i s t o be mai l ed.
( 2) The dat e t he owner si gned t he cont r act .
( e) The cont r act shal l be accompani ed by a compl et ed f or mi n
dupl i cat e, capt i oned " not i ce of cancel l at i on, " whi ch shal l be
at t ached t o t he cont r act , shal l be easi l y det achabl e, and shal l
cont ai n i n t ype of at l east 10- poi nt t he f ol l owi ng st at ement wr i t t en
i n t he same l anguage as used i n t he cont r act :
" NOTI CE OF CANCELLATI ON
( Ent er dat e of t r ansact i on) ( Dat e)
You may cancel t hi s t r ansact i on, wi t hout any
penal t y or obl i gat i on, wi t hi n t hr ee busi ness days
f r omt he above dat e.
To cancel t hi s t r ansact i on, mai l or del i ver a
si gned and dat ed copy of t hi s cancel l at i on not i ce,
or any ot her wr i t t en not i ce, or send a t el egr amt o
( Name of f or ecl osur e consul t ant )
at
( Addr ess of f or ecl osur e consul t ant ' s pl ace of
busi ness)
NOT LATER THAN MI DNI GHT OF _______________________.
( Dat e)
I her eby cancel t hi s t r ansact i on
__________________________________________________.
( Dat e)
________________________________________________"
( Owner ' s si gnat ur e)
( f ) The f or ecl osur e consul t ant shal l pr ovi de t he owner wi t h a copy






____________________ ________________________
____________________________















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of t he cont r act and t he at t ached not i ce of cancel l at i on.
( g) Unt i l t he f or ecl osur e consul t ant has compl i ed wi t h t hi s
sect i on, t he owner may cancel t he cont r act .
( h) Af t er t he 65- day per i od f ol l owi ng t he f or ecl osur e sal e, t he
f or ecl osur e consul t ant may ent er i nt o a cont r act t o assi st t he owner
i n ar r angi ng, or ar r ange f or t he owner , t he r el ease of f unds
r emai ni ng af t er t he f or ecl osur e sal e ( " sur pl us f unds" ) f r omt he
benef i ci ar y, mor t gagee, t r ust ee under a power of sal e, or counsel f or
t he benef i ci ar y, mor t gagee, or t r ust ee. However , pr i or t o ent er i ng
i nt o t hat cont r act , t he f or ecl osur e consul t ant shal l do al l of t he
f ol l owi ng:
( 1) Pr epar e and del i ver t o t he owner a not i ce i n 14- poi nt bol df ace
t ype and subst ant i al l y i n t he f or mset f or t h bel ow.
( 2) Obt ai n a r ecei pt execut ed by each owner and acknowl edged
bef or e a not ar y publ i c, acknowl edgi ng a copy of t he not i ce set f or t h
bel ow.
" NOTI CE TO OWNER
( Dat e of Cont r act ) ( Dat e si gned by Owner )
( Dat e of For ecl osur e Sal e)
You may be ent i t l ed t o r ecei ve al l or a por t i on
of t he sur pl us f unds gener at ed f r omt he
f or ecl osur e sal e of your r eal pr oper t y l ocat ed
at : __________________________, Cal i f or ni a on
_________________________wi t hout payi ng any f ees
or cost s of any ki nd t o a t hi r d par t y. You
shoul d check di r ect l y wi t h t he t r ust ee or
benef i ci ar y who conduct ed t he f or ecl osur e sal e
of your pr oper t y t o det er mi ne t he name, addr ess,
and t el ephone number of t he par t y t o whomyou
can di r ect i nqui r i es r egar di ng f i l i ng a cl ai m
f or sur pl us f unds wi t hout payi ng a f ee t o a
t hi r d par t y. No per son or ent i t y may r equi r e you
t o ent er i nt o any agr eement r equi r i ng t he
payment of a f ee t o t hat per son or ent i t y i n
or der t o r ecei ve t he sur pl us f unds f r om
t he f or ecl osur e sal e t o whi ch you may be
ent i t l ed dur i ng t he 65 days af t er t he dat e of
t he t r ust ee' s sal e. "
2945. 3. ( a) Ever y cont r act shal l be i n wr i t i ng and shal l f ul l y
di scl ose t he exact nat ur e of t he f or ecl osur e consul t ant ' s ser vi ces
and t he t ot al amount and t er ms of compensat i on.
( b) The f ol l owi ng not i ce, pr i nt ed i n at l east 14- poi nt bol df ace
t ype and compl et ed wi t h t he name of t he f or ecl osur e consul t ant , shal l
be pr i nt ed i mmedi at el y above t he st at ement r equi r ed by subdi vi si on
( d) :
" NOTI CE REQUI RED BY CALI FORNI A LAW
_____________________________________ or anyone
( Name)
wor ki ng f or hi mor her CANNOT:
Operative July 1, 2009


















___________________________________________








WAIS Document Retrieval Page 7 of 12
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( 1) Take any money f r omyou or ask you f or
money
unt i l _____________________________________ has
( Name)
compl et el y f i ni shed doi ng ever yt hi ng he or she
sai d he or she woul d do; and
( 2) Ask you t o si gn or have you si gn any l i en,
deed of t r ust , or deed. "
( c) The cont r act shal l be wr i t t en i n t he same l anguage as
pr i nci pal l y used by t he f or ecl osur e consul t ant t o descr i be hi s or her
ser vi ces or t o negot i at e t he cont r act . I n addi t i on, t he f or ecl osur e
consul t ant shal l pr ovi de t he owner , bef or e t he owner si gns t he
cont r act , wi t h a copy of a compl et ed cont r act wr i t t en i n any ot her
l anguage used i n any communi cat i on bet ween t he f or ecl osur e consul t ant
and t he owner and i n any l anguage descr i bed i n subdi vi si on ( b) of
Sect i on 1632 and r equest ed by t he owner . I f Engl i sh i s t he l anguage
pr i nci pal l y used by t he f or ecl osur e consul t ant t o descr i be t he
f or ecl osur e consul t ant ' s ser vi ces or t o negot i at e t he cont r act , t he
f or ecl osur e consul t ant shal l not i f y t he owner or al l y and i n wr i t i ng
bef or e t he owner si gns t he cont r act t hat t he owner has t he r i ght t o
ask f or a compl et ed copy of t he cont r act i n a l anguage descr i bed i n
subdi vi si on ( b) of Sect i on 1632.
( d) The cont r act shal l be dat ed and si gned by t he owner and shal l
cont ai n i n i mmedi at e pr oxi mi t y t o t he space r eser ved f or t he owner ' s
si gnat ur e a conspi cuous st at ement i n a si ze equal t o at l east
10- poi nt bol df ace t ype, as f ol l ows: " You, t he owner , may cancel t hi s
t r ansact i on at any t i me pr i or t o mi dni ght of t he f i f t h busi ness day
af t er t he dat e of t hi s t r ansact i on. See t he at t ached not i ce of
cancel l at i on f or mf or an expl anat i on of t hi s r i ght . "
( e) The cont r act shal l cont ai n on t he f i r st page, i n a t ype si ze
no smal l er t han t hat gener al l y used i n t he body of t he document , each
of t he f ol l owi ng:
( 1) The name, mai l i ng addr ess, el ect r oni c mai l addr ess, and
f acsi mi l e number of t he f or ecl osur e consul t ant t o whi ch t he not i ce of
cancel l at i on i s t o be mai l ed.
( 2) The dat e t he owner si gned t he cont r act .
( f ) The cont r act shal l be accompani ed by a compl et ed f or mi n
dupl i cat e, capt i oned " not i ce of cancel l at i on, " whi ch shal l be
at t ached t o t he cont r act , shal l be easi l y det achabl e, and shal l
cont ai n i n t ype of at l east 10- poi nt t he f ol l owi ng st at ement wr i t t en
i n t he same l anguage as used i n t he cont r act :
" NOTI CE OF CANCELLATI ON
( Ent er dat e of t r ansact i on) ( Dat e)
You may cancel t hi s t r ansact i on, wi t hout any penal t y
or
obl i gat i on, wi t hi n f i ve busi ness days f r omt he above
dat e.
To cancel t hi s t r ansact i on, mai l or del i ver a si gned
and dat ed copy of t hi s cancel l at i on not i ce, or any
ot her wr i t t en not i ce, or send a t el egr am,
t o __________________________________________________
( Name of f or ecl osur e consul t ant )
at __________________________________________________
( Addr ess of f or ecl osur e consul t ant ' s pl ace of



_____________________________________________________

_____________________________________________________





















WAIS Document Retrieval Page 8 of 12
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busi ness)
You may al so cancel by sendi ng a f acsi mi l e ( f ax) of
a si gned and dat ed copy of t hi s cancel l at i on not i ce,
or any ot her wr i t t en not i ce, t o t he f ol l owi ng number :
( Facsi mi l e t el ephone number of f or ecl osur e
consul t ant ' s pl ace of busi ness)
You may al so cancel by sendi ng an e- mai l cancel i ng
t hi s t r ansact i on t o t he f ol l owi ng e- mai l addr ess:
( E- mai l addr ess of f or ecl osur e consul t ant ' s
busi ness)
I her eby cancel t hi s t r ansact i on
____________________________________________________.
( Dat e)
_________________________ "
( Owner ' s si gnat ur e)
( g) The f or ecl osur e consul t ant shal l pr ovi de t he owner wi t h a copy
of t he cont r act and t he at t ached not i ce of cancel l at i on.
( h) Unt i l t he f or ecl osur e consul t ant has compl i ed wi t h t hi s
sect i on, t he owner may cancel t he cont r act .
2945. 4. I t shal l be a vi ol at i on f or a f or ecl osur e consul t ant t o:
( a) Cl ai m, demand, char ge, col l ect , or r ecei ve any compensat i on
unt i l af t er t he f or ecl osur e consul t ant has f ul l y per f or med each and
ever y ser vi ce t he f or ecl osur e consul t ant cont r act ed t o per f or mor
r epr esent ed t hat he or she woul d per f or m.
( b) Cl ai m, demand, char ge, col l ect , or r ecei ve any f ee, i nt er est ,
or any ot her compensat i on f or any r eason whi ch exceeds 10 per cent per
annumof t he amount of any l oan whi ch t he f or ecl osur e consul t ant may
make t o t he owner .
( c) Take any wage assi gnment , any l i en of any t ype on r eal or
per sonal pr oper t y, or ot her secur i t y t o secur e t he payment of
compensat i on. That secur i t y shal l be voi d and unenf or ceabl e.
( d) Recei ve any consi der at i on f r omany t hi r d par t y i n connect i on
wi t h ser vi ces r ender ed t o an owner unl ess t hat consi der at i on i s f ul l y
di scl osed t o t he owner .
( e) Acqui r e any i nt er est i n a r esi dence i n f or ecl osur e f r oman
owner wi t h whomt he f or ecl osur e consul t ant has cont r act ed. Any
i nt er est acqui r ed i n vi ol at i on of t hi s subdi vi si on shal l be voi dabl e,
pr ovi ded t hat not hi ng her ei n shal l af f ect or def eat t he t i t l e of a
bona f i de pur chaser or encumbr ancer f or val ue and wi t hout not i ce of a
vi ol at i on of t hi s ar t i cl e. Knowl edge t hat t he pr oper t y was
" r esi dent i al r eal pr oper t y i n f or ecl osur e, " does not const i t ut e
not i ce of a vi ol at i on of t hi s ar t i cl e. Thi s subdi vi si on may not be
deemed t o abr ogat e any dut y of i nqui r y whi ch exi st s as t o r i ght s or
i nt er est s of per sons i n possessi on of r esi dent i al r eal pr oper t y i n
f or ecl osur e.
( f ) Take any power of at t or ney f r oman owner f or any pur pose,
except t o i nspect document s as pr ovi ded by l aw.
( g) I nduce or at t empt t o i nduce any owner t o ent er i nt o a cont r act
whi ch does not compl y i n al l r espect s wi t h Sect i ons 2945. 2 and
2945. 3.
( h) Ent er i nt o an agr eement t o assi st t he owner i n ar r angi ng, or
ar r ange f or t he owner , t he r el ease of sur pl us f unds pr i or t o 65 days
af t er t he t r ust ee' s sal e i s conduct ed, whet her t he agr eement i nvol ves
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WAIS Document Retrieval Page 9 of 12
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di r ect payment , assi gnment , deed, power of at t or ney, or assi gnment
of cl ai mf r oman owner t o t he f or ecl osur e consul t ant or any per son
desi gnat ed by t he f or ecl osur e consul t ant .
2945. 4. I t shal l be a vi ol at i on f or a f or ecl osur e consul t ant t o:
( a) Cl ai m, demand, char ge, col l ect , or r ecei ve any compensat i on
unt i l af t er t he f or ecl osur e consul t ant has f ul l y per f or med each and
ever y ser vi ce t he f or ecl osur e consul t ant cont r act ed t o per f or mor
r epr esent ed t hat he or she woul d per f or m.
( b) Cl ai m, demand, char ge, col l ect , or r ecei ve any f ee, i nt er est ,
or any ot her compensat i on f or any r eason whi ch exceeds 10 per cent per
annumof t he amount of any l oan whi ch t he f or ecl osur e consul t ant may
make t o t he owner .
( c) Take any wage assi gnment , any l i en of any t ype on r eal or
per sonal pr oper t y, or ot her secur i t y t o secur e t he payment of
compensat i on. That secur i t y shal l be voi d and unenf or ceabl e.
( d) Recei ve any consi der at i on f r omany t hi r d par t y i n connect i on
wi t h ser vi ces r ender ed t o an owner unl ess t hat consi der at i on i s f ul l y
di scl osed t o t he owner .
( e) Acqui r e any i nt er est i n a r esi dence i n f or ecl osur e f r oman
owner wi t h whomt he f or ecl osur e consul t ant has cont r act ed. Any
i nt er est acqui r ed i n vi ol at i on of t hi s subdi vi si on shal l be voi dabl e,
pr ovi ded t hat not hi ng her ei n shal l af f ect or def eat t he t i t l e of a
bona f i de pur chaser or encumbr ancer f or val ue and wi t hout not i ce of a
vi ol at i on of t hi s ar t i cl e. Knowl edge t hat t he pr oper t y was
" r esi dent i al r eal pr oper t y i n f or ecl osur e, " does not const i t ut e
not i ce of a vi ol at i on of t hi s ar t i cl e. Thi s subdi vi si on may not be
deemed t o abr ogat e any dut y of i nqui r y whi ch exi st s as t o r i ght s or
i nt er est s of per sons i n possessi on of r esi dent i al r eal pr oper t y i n
f or ecl osur e.
( f ) Take any power of at t or ney f r oman owner f or any pur pose.
( g) I nduce or at t empt t o i nduce any owner t o ent er i nt o a cont r act
whi ch does not compl y i n al l r espect s wi t h Sect i ons 2945. 2 and
2945. 3.
( h) Ent er i nt o an agr eement at any t i me t o assi st t he owner i n
ar r angi ng, or ar r ange f or t he owner , t he r el ease of sur pl us f unds
af t er t he t r ust ee' s sal e i s conduct ed, whet her t he agr eement i nvol ves
di r ect payment , assi gnment , deed, power of at t or ney, assi gnment of
cl ai mf r oman owner t o t he f or ecl osur e consul t ant or any per son
desi gnat ed by t he f or ecl osur e consul t ant , or any ot her compensat i on.
2945. 45. ( a) Except as pr ovi ded i n subdi vi si on ( b) of Sect i on
2945. 1, a per son shal l not t ake any act i on speci f i ed i n subdi vi si on
( a) of Sect i on 2945. 1 unl ess t he per son sat i sf i es t he f ol l owi ng
r equi r ement s:
( 1) The per son r egi st er s wi t h, and i s i ssued and mai nt ai ns a
cer t i f i cat e of r egi st r at i on f r om, t he Depar t ment of J ust i ce i n
accor dance wi t h t he f ol l owi ng r equi r ement s:
( A) The per son shal l submi t a compl et ed r egi st r at i on f or m, al ong
wi t h appl i cabl e f ees, t o t he depar t ment . The r egi st r at i on f or mshal l
i ncl ude t he name, addr ess, and t el ephone number of t he f or ecl osur e
consul t ant , al l of t he names, addr esses, t el ephone number s, I nt er net
Web si t es, and e- mai l addr esses used or pr oposed t o be used i n
connect i on wi t h act i ng as a f or ecl osur e consul t ant , a st at ement t hat
t he per son has not been convi ct ed of , or pl ed nol o cont ender e t o, any
Operative July 1, 2009





















WAIS Document Retrieval Page 10 of 12
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cr i me i nvol vi ng f r aud, mi sr epr esent at i on, di shonest y, or a vi ol at i on
of t hi s ar t i cl e, a st at ement t hat t he per son has not been l i abl e
under any civil j udgment f or f r aud, mi sr epr esent at i on, or vi ol at i ons
of t hi s ar t i cl e or of Sect i on 17200 or 17500 of t he Busi ness and
Pr of essi ons Code, and any addi t i onal i nf or mat i on r equi r ed by t he
depar t ment .
( B) The r egi st r at i on f or mshal l be accompani ed by a copy of al l
pr i nt or el ect r oni c adver t i si ng and ot her pr omot i onal mat er i al , and
scr i pt s of al l t el ephoni c or br oadcast adver t i si ng and ot her
st at ement s used or pr oposed t o be used i n connect i on wi t h act i ng as a
f or ecl osur e consul t ant .
( C) The r egi st r at i on f or mshal l be accompani ed by a copy of t he
bond r equi r ed pur suant t o par agr aph ( 2) .
( D) The per son shal l f i l e an updat e of any mat er i al change i n t he
i nf or mat i on r equi r ed by subpar agr aphs ( A) and ( B) wi t h t he
depar t ment .
( E) The per son shal l pay any f ee set by t he depar t ment t o def r ay
r easonabl e cost s i ncur r ed i n connect i on wi t h t he depar t ment ' s
r esponsi bi l i t i es under t hi s ar t i cl e.
( 2) The per son obt ai ns and mai nt ai ns i n f or ce a sur et y bond i n t he
amount of one hundr ed t housand dol l ar s ( $100, 000) . The bond shal l be
execut ed by a cor por at e sur et y admi t t ed t o do busi ness i n t hi s
st at e. The bond shal l be made i n f avor of t he St at e of Cal i f or ni a f or
t he benef i t of homeowner s f or damages caused by t he f or ecl osur e
consul t ant ' s vi ol at i on of t hi s ar t i cl e or any ot her pr ovi si on of l aw.
A copy of t he bond shal l be f i l ed wi t h t he Secr et ar y of St at e, wi t h
a copy pr ovi ded t o t he depar t ment pur suant t o subpar agr aph ( C) of
par agr aph ( 1) .
( b) The For ecl osur e Consul t ant Regul at i on Fund i s her eby cr eat ed
i n t he St at e Tr easur y f or t he deposi t of f ees submi t t ed t o t he
Depar t ment of J ust i ce pur suant t o subpar agr aph ( A) of par agr aph ( 1)
of subdi vi si on ( a) f or r egi st r at i on as a f or ecl osur e consul t ant .
Moneys i n t he f und shal l be avai l abl e, upon appr opr i at i on by t he
Legi sl at ur e, f or t he cost s of t he depar t ment i ncur r ed i n connect i on
wi t h t he admi ni st r at i on of t he r egi st r at i on pr ogr am.
( c) The Depar t ment of J ust i ce may r ef use t o i ssue, or may r evoke,
a cer t i f i cat e of r egi st r at i on because of any mi sst at ement i n t he
r egi st r at i on f or m, because t he f or ecl osur e consul t ant has been hel d
l i abl e f or t he vi ol at i on of any l aw descr i bed i n subpar agr aph ( A) of
par agr aph ( 1) of subdi vi si on ( a) , because t he f or ecl osur e consul t ant
has f ai l ed t o mai nt ai n t he bond r equi r ed under par agr aph ( 2) of
subdi vi si on ( a) , or because of any vi ol at i on of t hi s chapt er .
( d) A per son who vi ol at es subdi vi si on ( a) shal l be puni shed, f or
each vi ol at i on, by a f i ne of not l ess t han one t housand dol l ar s
( $1, 000) and not mor e t han t went y- f i ve t housand dol l ar s ( $25, 000) , by
i mpr i sonment i n t he count y j ai l f or not mor e t han one year , or by
bot h t hat f i ne and i mpr i sonment . The i mposi t i on of a penal t y pur suant
t o t hi s subdi vi si on shal l not be af f ect ed by t he avai l abi l i t y of any
ot her r el i ef , r emedy, or penal t y pr ovi ded by l aw, and shal l not
af f ect t he avai l abi l i t y of any such r el i ef , r emedy, or penal t y.
2945. 5. Any wai ver by an owner of t he pr ovi si ons of t hi s ar t i cl e
shal l be deemed voi d and unenf or ceabl e as cont r ar y t o publ i c pol i cy.
Any at t empt by a f or ecl osur e consul t ant t o i nduce an owner t o wai ve
hi s r i ght s shal l be deemed a vi ol at i on of t hi s ar t i cl e.



























WAIS Document Retrieval Page 11 of 12
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2945. 6. ( a) An owner may br i ng an act i on agai nst a f or ecl osur e
consul t ant f or any vi ol at i on of t hi s chapt er . J udgment shal l be
ent er ed f or act ual damages, r easonabl e at t or neys' f ees and cost s, and
appr opr i at e equi t abl e r el i ef . The cour t al so may, i n i t s
di scr et i on, awar d exempl ar y damages and shal l awar d exempl ar y damages
equi val ent t o at l east t hr ee t i mes t he compensat i on r ecei ved by t he
f or ecl osur e consul t ant i n vi ol at i on of subdi vi si on ( a) , ( b) , or ( d)
of Sect i on 2945. 4, and t hr ee t i mes t he owner ' s act ual damages f or any
vi ol at i on of subdi vi si on ( c) , ( e) , or ( g) of Sect i on 2945. 4, i n
addi t i on t o any ot her awar d of act ual or exempl ar y damages.
( b) The r i ght s and r emedi es pr ovi ded i n subdi vi si on ( a) ar e
cumul at i ve t o, and not a l i mi t at i on of , any ot her r i ght s and r emedi es
pr ovi ded by l aw. Any act i on br ought pur suant t o t hi s sect i on shal l
be commenced wi t hi n f our year s f r omt he dat e of t he al l eged
vi ol at i on.
2945. 7. Any per son who commi t s any vi ol at i on descr i bed i n Sect i on
2945. 4 shal l be puni shed by a f i ne of not mor e t han t en t housand
dol l ar s ( $10, 000) , by i mpr i sonment i n t he count y j ai l f or not mor e
t han one year , or i n t he st at e pr i son, or by bot h t hat f i ne and
i mpr i sonment f or each vi ol at i on. These penal t i es ar e cumul at i ve t o
any ot her r emedi es or penal t i es pr ovi ded by l aw.
2945. 8. I f any pr ovi si on of t hi s ar t i cl e or t he appl i cat i on t her eof
t o any per son or ci r cumst ance i s hel d t o be unconst i t ut i onal , t he
r emai nder of t he ar t i cl e and t he appl i cat i on of such pr ovi si on t o
ot her per sons and ci r cumst ances shal l not be af f ect ed t her eby.
2945. 9. ( a) A f or ecl osur e consul t ant i s l i abl e f or al l damages
r esul t i ng f r omany st at ement made or act commi t t ed by t he f or ecl osur e
consul t ant ' s r epr esent at i ve i n any manner connect ed wi t h t he
f or ecl osur e consul t ant ' s ( 1) per f or mance, of f er t o per f or m, or
cont r act t o per f or many of t he ser vi ces descr i bed i n subdi vi si on ( a)
of Sect i on 2945. 1, ( 2) r ecei pt of any consi der at i on or pr oper t y f r om
or on behal f of an owner , or ( 3) per f or mance of any act pr ohi bi t ed by
t hi s ar t i cl e.
( b) " Repr esent at i ve" f or t he pur poses of t hi s sect i on means a
per son who i n any manner sol i ci t s, i nduces, or causes ( 1) any owner
t o cont r act wi t h a f or ecl osur e consul t ant , ( 2) any owner t o pay any
consi der at i on or t r ansf er t i t l e t o t he r esi dence i n f or ecl osur e t o
t he f or ecl osur e consul t ant , or ( 3) any member of t he owner ' s f ami l y
or househol d t o i nduce or cause any owner t o pay any consi der at i on or
t r ansf er t i t l e t o t he r esi dence i n f or ecl osur e t o t he f or ecl osur e
consul t ant .
2945. 10. ( a) Any pr ovi si on i n a cont r act whi ch at t empt s or pur por t s
t o l i mi t t he l i abi l i t y of t he f or ecl osur e consul t ant under Sect i on
2945. 9 shal l be voi d and shal l at t he opt i on of t he owner r ender t he
cont r act voi d. The f or ecl osur e consul t ant shal l be l i abl e t o t he
owner f or al l damages pr oxi mat el y caused by t hat pr ovi si on. Any
pr ovi si on i n a cont r act whi ch at t empt s or pur por t s t o r equi r e












WAIS Document Retrieval
ar bi t r at i on of any di sput e ar i si ng under t hi s chapt er shal l be voi d
at t he opt i on of t he owner onl y upon gr ounds as exi st f or t he
r evocat i on of any cont r act .
( b) Thi s sect i on shal l appl y t o any cont r act ent er ed i nt o on or
af t er J anuar y 1, 1991.
2945. 11. ( a) Any r epr esent at i ve, as def i ned i n subdi vi si on ( b) of
Sect i on 2945. 9, deemed t o be t he agent or empl oyee or bot h t he agent
and t he empl oyee of t he f or ecl osur e consul t ant shal l be r equi r ed t o
pr ovi de bot h of t he f ol l owi ng:
( 1) Wr i t t en pr oof t o t he owner t hat t he r epr esent at i ve has a val i d
cur r ent Cal i f or ni a Real Est at e Sal es Li cense and t hat t he
r epr esent at i ve i s bonded by an admi t t ed sur et y i nsur er i n an amount
equal t o at l east t wi ce t he f ai r mar ket val ue of t he r eal pr oper t y
t hat i s t he subj ect of t he cont r act .
( 2) A st at ement i n wr i t i ng, under penal t y of per j ur y, t hat t he
r epr esent at i ve has a val i d cur r ent Cal i f or ni a Real Est at e Sal es
Li cense, t hat t he r epr esent at i ve i s bonded by an admi t t ed sur et y
i nsur er i n an amount equal t o at l east t wi ce t he val ue of t he r eal
pr oper t y t hat i s t he subj ect of t he cont r act and has compl i ed wi t h
par agr aph ( 1) . The wr i t t en st at ement r equi r ed by t hi s par agr aph
shal l be pr ovi ded t o al l par t i es t o t he cont r act pr i or t o t he
t r ansf er of any i nt er est i n t he r eal pr oper t y t hat i s t he subj ect of
t he cont r act .
( b) The f ai l ur e t o compl y wi t h subdi vi si on ( a) shal l , at t he
opt i on of t he owner , r ender t he cont r act voi d and t he f or ecl osur e
consul t ant shal l be l i abl e t o t he owner f or al l damages pr oxi mat el y
caused by t he f ai l ur e t o compl y.
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