SHORT SALE SOUNDOFF: VICTORY FOR SHORT SALE SELLERS

Last Friday, Governor Jerry Brown signed SB 458 (Corbett) into law. SB 458 extends the protections of SB 931 (2010), to ensure that any lender that agrees to a short sale must accept the agreed upon short sale payment in full of the outstanding balance of all loans.

Under previous law (SB 931 of 2010), a first mortgage holder could accept an agreed-upon short sale payment as full payment for the outstanding balance of the loan, but unfortunately, the rule did not apply to junior lien holders.

SB 458 extends the protections of SB 931 to junior liens. SB 458 contains an urgency clause making it effective upon signing.