§ 2923.55. — 2923.55. (Amended by Stats. 2024, Ch. 311, Sec. 2.)

(a)
A mortgage servicer, mortgagee, trustee, beneficiary, or authorized agent shall not record a notice of default pursuant to Section 2924 until all of the following:
(1)
The mortgage servicer has satisfied the requirements of paragraph (1) of subdivision (b).
(2)
Either 30 days after initial contact is made as required by paragraph (2) of subdivision (b) or 30 days after satisfying the due diligence requirements as described in subdivision (f).
(3)
The mortgage servicer complies with subdivision (c) of Section 2923.6, if the borrower has provided a complete
application as defined in subdivision (h) of Section 2923.6.
(b)
(1)
As specified in subdivision (a), a mortgage servicer shall send the following information in writing to the borrower:
(A)
A statement that if the borrower is a servicemember or a dependent of a servicemember, the borrower may be entitled to certain protections under the federal Servicemembers Civil Relief Act (50 U.S.C. Sec. 3901 et seq.) regarding the servicemember’s interest rate and the risk of foreclosure, and counseling for covered servicemembers that is available at agencies such as Military OneSource and Armed Forces Legal Assistance.
(B)
A statement that the borrower may request the following:
(i)
A copy of the borrower’s promissory note or other evidence of indebtedness.
(ii)
A copy of the borrower’s deed of trust or mortgage.
(iii)
A copy of any assignment, if applicable, of the borrower’s mortgage or deed of trust required to demonstrate the right of the mortgage servicer to foreclose.
(iv)
A copy of the borrower’s payment history since the borrower was last less than 60 days past due.
(2)
(A)
A mortgage servicer shall contact the borrower in person or by telephone in order to assess the borrower’s financial situation and explore options for the borrower to avoid foreclosure.
During the initial contact, the mortgage servicer shall advise the borrower that the borrower has the right to request a subsequent meeting and, if requested, the mortgage servicer shall schedule the meeting to occur within 14 days. The assessment of the borrower’s financial situation and discussion of options may occur during the first contact, or at the subsequent meeting scheduled for that purpose. In either case, the borrower shall be provided the toll-free telephone number made available by the United States Department of Housing and Urban Development (HUD) to find a HUD-certified housing counseling agency. Any meeting may occur telephonically.
(B)
The mortgage servicer shall notify the borrower during the initial contact required pursuant to subparagraph (A) that a third party, such as a family member, HUD-certified housing counselor, or
attorney, may record a request to receive copies of any notice of default and notice of sale pursuant to the process described in Section 2924b and that receiving a copy of these documents may allow the third party to assist the borrower in avoiding foreclosure.
(c)
A notice of default recorded pursuant to Section 2924 shall include a declaration that the mortgage servicer has contacted the borrower, has tried with due diligence to contact the borrower as required by this section, or that no contact was required because the individual did not meet the definition of “borrower” pursuant to subdivision (c) of Section 2920.5.
(d)
A mortgage servicer’s loss mitigation personnel may participate by telephone during any contact required by this section.
(e)
A borrower may designate, with consent given in writing, a HUD-certified housing counseling agency, attorney, or other adviser to discuss with the mortgage servicer, on the borrower’s behalf, the borrower’s financial situation and options for the borrower to avoid foreclosure. That contact made at the direction of the borrower shall satisfy the contact requirements of paragraph (2) of subdivision (b). Any foreclosure prevention alternative offered at the meeting by the mortgage servicer is subject to approval by the borrower.
(f)
A notice of default may be recorded pursuant to Section 2924 when a mortgage servicer has not contacted a borrower as required by paragraph (2) of subdivision (b), provided that the failure to contact the borrower occurred despite the due diligence of the mortgage servicer. For purposes of this section, “due
diligence” shall require and mean all of the following:
(1)
(A)
A mortgage servicer shall first attempt to contact a borrower by sending a first-class letter that includes the toll-free telephone number made available by HUD to find a HUD-certified housing counseling agency.
(B)
The mortgage servicer shall notify the borrower in the first-class letter described in subparagraph (A) that a third party, such as a family member, HUD-certified housing counselor, or attorney, may record a request to receive copies of any notice of default and notice of sale pursuant to the process described in Section 2924b and that receiving a copy of these documents may allow the third party to assist the borrower in avoiding foreclosure.
(2)
(A)
After the letter has been sent, the mortgage servicer shall attempt to contact the borrower by telephone at least three times at different hours and on different days. Telephone calls shall be made to the primary telephone number on file.
(B)
A mortgage servicer may attempt to contact a borrower using an automated system to dial borrowers, provided that, if the telephone call is answered, the call is connected to a live representative of the mortgage servicer.
(C)
A mortgage servicer satisfies the telephone contact requirements of this paragraph:
(i)
If it determines, after attempting contact pursuant to this paragraph, that the borrower’s primary telephone number and secondary
telephone number or numbers on file, if any, have been disconnected.
(ii)
If the borrower or the borrower’s authorized agent notifies the mortgage servicer in writing to cease further communication with the borrower. The cease communication notification shall explicitly pertain to the mortgage loan account to be effective. The cease communication notification shall be effective until the borrower or the borrower’s authorized agent rescinds it in writing.
(3)
If the borrower does not respond within two weeks after the telephone call requirements of paragraph (2) have been satisfied, the mortgage servicer shall then send a certified letter, with return receipt requested, that includes the toll-free telephone number made available by HUD to find a HUD-certified housing counseling
agency.
(4)
The mortgage servicer shall provide a means for the borrower to contact it in a timely manner, including a toll-free telephone number that will provide access to a live representative during business hours.
(5)
The mortgage servicer has posted a prominent link on the home page of its internet website, if any, to the following information:
(A)
Options that may be available to borrowers who are unable to afford their mortgage payments and who wish to avoid foreclosure, and instructions to borrowers advising them on steps to
take to explore those options.
(B)
A list of financial documents borrowers should collect and be prepared to present to the mortgage servicer when discussing options for avoiding foreclosure.
(C)
A toll-free telephone number for borrowers who wish to discuss options for avoiding foreclosure with their mortgage servicer.
(D)
The toll-free telephone number made available by HUD to find a HUD-certified housing counseling agency.
(g)
This section shall not apply to entities described in subdivision (b) of Section 2924.18.
(h)
This section shall apply only to mortgages or deeds of trust described in
Section 2924.15.

Legislative History

Amended by Stats. 2024, Ch. 311, Sec. 2. (AB 2424) Effective January 1, 2025.