What is the Right of Redemption?

When property is sold through non-judicial foreclosure on an assessment lien, buyers (third parties or the association) take ownership subject to a 90-day right of redemption, which allows the foreclosed owner to recover the property if the owner pays the delinquency and any fees and costs (Civil Code §1367.4(c)(4); Code of Civil Proc. §729.035).

This right of redemption is unusual in that it does not apply to non-judicial foreclosure on trust deeds; it was added to the law for community associations several years ago to help owners so they do not lose their homes because they did not pay their associations assessments or fees. Owners rarely take advantage of this right.

Typically, the foreclosure trustee will hold the money received at the foreclosure sale for 90 days. If the former owner exercises the right of redemption and pays the amount owed (all amounts owed including all fees and costs etc.), the buyer has his/her money refunded, the association receives what it is owed and the owner keeps their property.

For that 90-day period, the buyer of the property (and this includes the association that may have “bought” the property because no one bid on the property at the sale) can do nothing with the property. It is a 90-day waiting period.

Code of Civil Procedure §729.035. Right of Redemption

“Notwithstanding any provision of law to the contrary, the sale of a separate interest in a common interest development is subject to the right of redemption within 90 days after the sale if the sale arises from a foreclosure by the association of a common interest development pursuant to Section 1367.1(g) of the Civil Code, subject to the conditions of Section 1367.4 of the Civil Code.”

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