New Ruling: California Courts Halt All Lender Foreclosures and Renter Evictions
Almost all California foreclosures and evictions have been put on hold for the foreseeable future.
The state’s Judicial Council on Monday, April 6 issued emergency orders that stop lenders’ efforts to foreclosure on mortgages and landlords’ ability to evict tenants — except in cases where public health or safety are involved.
The Judicial Council is the rule-making arm of the California court system. These actions are its way of implementing various mandates from Gov. Gavin Newsom attempting to limit the spread of coronavirus and mitigate the economic impacts of business shutdowns.
The governor’s edicts, which include stiff limitations on lender foreclosures and tenant evictions, have been criticized by some in the housing industry as putting investment property owners and banks at financial risk.
The council’s moves are a way to offer housing protections as well as minimize the court’s own workload as it tries to operate within “stay at home” mandates and “social distancing” rules.
“We are at this point truly with no guidance in history, law or precedent,” said Chief Justice Tani Cantil-Sakauye, chair of the council, in a statement. “And to say that there is no playbook is a gross understatement of the situation. In developing these rules, we listened to suggestions from our justice system partners, the public, and the courts, and we greatly appreciate all of the input.
“Working with our court stakeholders, I’m confident we can preserve the rule of law and protect the rights of victims, the accused, litigants, families and children, and all who seek justice. It’s truly a team effort,” Cantil-Sakauye wrote.
The council’s new rules apply for 90 days after California’s state of emergency is lifted, unless they’re altered by the council. The new rules mean borrowers and tenants do not have to respond to legal demands for payments during this period, and the rights to fight foreclosures and evictions are extended past the council’s freeze period.
The state legislature is expected to address issues such as terms for repayment plans for missed housing payments during the coronavirus crisis when it reconvenes later this month.
“We are extremely relieved that the Judicial Council has shown the type of leadership we need to make sure that basic, straightforward protections are in place, reducing any immediate risk to tenants and allowing them to focus on protecting their health and safety without worrying about losing their homes at a time when they are being told to shelter in place to avoid the spread of a highly contagious and deadly virus,” stated Western Center on Law & Poverty, a tenant rights group.
The council also has invoked emergency powers to temporarily eliminate bail for people arrested and charged with low-level offenses as part of a continuing effort to slow the influx of inmates and chances of a COVID-19 outbreak at county jails.
It unanimously approved setting bail to $0 for misdemeanors and most nonviolent felonies, and specified that the new condition also applies to those being held on bail on such charges.
The new bail standard will go into effect April 13, and will be in effect for 90 days after the end of the state of emergency.
— San Jose Mercury News staff writer Robert Salonga contributed to this report.