Avoiding Foreclosure in California: What You Need to Know​

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Assembly Bill 2424 (AB 2424) is a California law that took effect on January 1, 2025, designed to help homeowners facing imminent foreclosure. This bill gives qualifying homeowners a final opportunity to delay the foreclosure process for up to 90 days—but only after they’ve received a Notice of Sale.

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This is not a loan or financial product. It’s a legal safeguard that can provide much-needed time for a homeowner to sell their property and retain any remaining equity, rather than losing the home to foreclosure.

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Who Is Eligible for AB 2424?

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This law only applies after a homeowner has gone through the full 90-day default period and received a Notice of Sale from the court. At that point, a sale date has been assigned, and the foreclosure process is rapidly approaching its final step.

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If you’re at this stage, AB 2424 allows you to delay the foreclosure auction if you act quickly—at least five business days before the scheduled sale.

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What Does AB 2424 Allow You to Do?

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AB 2424 gives you two potential opportunities to delay foreclosure:

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Step 1: 45-Day Extension with Listing Agreement

• Requirement: You must submit a signed listing agreement showing that the home has been officially listed for sale.

• Deadline: Must be submitted to your lender at least five business days before the scheduled foreclosure sale date.

• Action: Always confirm via email that the lender received and acknowledged your submission. Get it in writing.

• Result: The lender is required to postpone the foreclosure sale by 45 days to allow time for the property to sell.

 

Step 2: Additional 45-Day Extension with Purchase Contract

• Requirement: If you secure a buyer and go under contract, you can request a second extension.

• Deadline: Again, the signed purchase contract must be submitted at least five business days before the end of the initial 45-day postponement.

• Result: This grants an additional 45 days, giving you up to 90 total days to complete the sale.

 

Important Timing Notes

• Business Days Only: When the law says “five business days,” it excludes weekends and federal holidays. Always pad your timeline to be safe—plan at least two weeks ahead of your sale date.

• No Third Chances: You only get these two extensions—first with a listing agreement, then with a purchase contract. If you miss either deadline, the foreclosure may proceed.

 

Other Key Protections in AB 2424

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Third-Party Notification Option

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Homeowners can now designate third parties (e.g., family members, attorneys, housing counselors, or financial professionals) to be notified if foreclosure proceedings begin. This ensures that someone else can step in and help if you’re incapacitated, unaware, or overwhelmed.

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Lender Must Disclose Alternatives

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Lenders are now required to clearly explain foreclosure alternatives like:

• Loan modifications

• Forbearance agreements

• Short sales (less common now due to strong home equity across most markets)

 

These disclosures are intended to make sure no homeowner misses out on a possible solution due to confusion or lack of communication.

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Why This Matters — And Why You Should Act Early

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Too often, homeowners wait too long, believing help is coming or hoping their situation will improve. Whether you’re counting on a refinance, a loan from family, or some other solution, it’s easy to run out of time.

AB 2424 provides one last window to protect your equity—but it’s only available after a Notice of Sale has been issued, and it requires fast action and clear documentation.

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Don’t Wait Until It’s Too Late

• Once the Notice of Sale is issued, your timeline is very short.

• Foreclosure sale notices become public record, which can lead to lowball offers if you’re trying to sell.

• A rushed timeline can reduce your ability to get fair market value.

• The sooner you speak to a real estate agent and price the home appropriately, the better your chances.

 

What Should You Do If You’re Facing Foreclosure?

If you’ve received a Notice of Sale, we recommend the following:

1. Call us immediately 916-204-8421

2. Get the home listed for sale ASAP.

3. **Send the signed listing agreement to your lender—**with at least five business days’ notice.

4. Confirm in writing that your lender has received and acknowledged your documentation.

5. Continue communicating weekly with your lender until the issue is resolved.

 

The Bottom Line​

AB 2424 is a lifeline—but only if used correctly and on time. It doesn’t stop foreclosure forever. It simply buys you the time to make a sale and walk away with the equity you’ve earned, instead of losing it all at auction.

If you’ve already received a Notice of Sale and feel overwhelmed, don’t panic. We can help you explore your options. Whether that means selling, refinancing, or considering other relief programs, we’ll help you understand what’s possible.

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Get Help Now — Before Time Runs Out

​We know it’s emotional, stressful, and time-sensitive. But you’re not alone—and AB 2424 could be the tool you need to regain control.