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.