June 16, 2021
By: Adeline Tungate
“Under the California one-action rule, “[t]here can be but one form of action for the recovery of any debt or the enforcement of any right secured by mortgage upon real property.” Cal. Code Civ. Proc. § 726(a). Thus, a lender can only pursue “one action” against a borrower, such as a trustee’s sale, judicial foreclosure, or filing a suit on the promissory note. California courts interpret this rule in conjunction with another, the “security-first” rule, which requires a lender to pursue recovery from real estate before suing the borrower personally. See Walker v. Community Bank, 10 Cal. 3d 729 (1974). Lenders are limited in their recovery, however, as they may foreclose upon a property securing a loan and still be left with a deficit.”
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