By Lou Galuppo

Introduction

In order to ultimately perfect ownership in Entitlements (as defined below) and/or Materials (as defined below), the foreclosing lender (“Lender”) needs to understand the status of Entitlements, Materials and underlying title to both the real and personal property.  From this knowledge, the Lender can determine the cost, time and related risk of completing the entitlement and development process.

The purpose of this article is to explain the issues and processes relating to protecting and perfecting rights in and to entitlements and related materials from the impact of foreclosure.  Also, for purposes of this article, “Entitlements” are parcel maps, tentative maps, final maps, coastal permits, grading permits, building permits and the like; and, “Materials” used to process an Entitlement usually, but not always (depending on the Entitlement), include consultant contracts, renderings, draft maps, consultant reports, designs, building plans and specifications, and the like.

By Lou Galuppo and Bart Blechschmidt

Introduction

On January 1, 2011, California Code of Civil Procedure §580e was enacted as an addition to existing Anti-Deficiency laws, protecting borrowers from deficiencies that occur as a result of short sales of certain types of real property.  Section 580e was later amended on July 15, 2011 as an “urgency statute” to take immediate effect and to expand the anti-deficiency protections for owners of distressed residential real properties.