2925.  The fact that a transfer was made subject to defeasance on a
condition, may, for the purpose of showing such transfer to be a
mortgage, be proved (except as against a subsequent purchaser or
incumbrancer for value and without notice), though the fact does not
appear by the terms of the instrument.



2926.  A mortgage is a lien upon everything that would pass by a
grant of the property.



2927.  A mortgage does not entitle the mortgagee to the possession
of the property, unless authorized by the express terms of the
mortgage; but after the execution of the mortgage the mortgagor may
agree to such change of possession without a new consideration.




2928.  A mortgage does not bind the mortgagor personally to perform
the act for the performance of which it is a security, unless there
is an express covenant therein to that effect.



2929.  No person whose interest is subject to the lien of a mortgage
may do any act which will substantially impair the mortgagee's
security.


2929.5.  (a) A secured lender may enter and inspect the real
property security for the purpose of determining the existence,
location, nature, and magnitude of any past or present release or
threatened release of any hazardous substance into, onto, beneath, or
from the real property security on either of the following:
   (1) Upon reasonable belief of the existence of a past or present
release or threatened release of any hazardous substance into, onto,
beneath, or from the real property security not previously disclosed
in writing to the secured lender in conjunction with the making,
renewal, or modification of a loan, extension of credit, guaranty, or
other obligation involving the borrower.
   (2) After the commencement of nonjudicial or judicial foreclosure
proceedings against the real property security.
   (b) The secured lender shall not abuse the right of entry and
inspection or use it to harass the borrower or tenant of the
property.  Except in case of an emergency, when the borrower or
tenant of the property has abandoned the premises, or if it is
impracticable to do so, the secured lender shall give the borrower or
tenant of the property reasonable notice of the secured lender's
intent to enter, and enter only during the borrower's or tenant's
normal business hours.  Twenty-four hours' notice shall be presumed
to be reasonable notice in the absence of evidence to the contrary.
   (c) The secured lender shall reimburse the borrower for the cost
of repair of any physical injury to the real property security caused
by the entry and inspection.
   (d) If a secured lender is refused the right of entry and
inspection by the borrower or tenant of the property, or is otherwise
unable to enter and inspect the property without a breach of the
peace, the secured lender may, upon petition, obtain an order from a
court of competent jurisdiction to exercise the secured lender's
rights under subdivision (a), and that action shall not constitute an
action within the meaning of subdivision (a) of Section 726 of the
Code of Civil Procedure.
   (e) For purposes of this section:
   (1) "Borrower" means the trustor under a deed of trust, or a
mortgagor under a mortgage, where the deed of trust or mortgage
encumbers real property security and secures the performance of the
trustor or mortgagor under a loan, extension of credit, guaranty, or
other obligation.  The term includes any successor-in-interest of the
trustor or mortgagor to the real property security before the deed
of trust or mortgage has been discharged, reconveyed, or foreclosed
upon.
   (2) "Hazardous substance" means (A) any "hazardous substance" as
defined in subdivision (f) of Section 25281 of the Health and Safety
Code as effective on January 1, 1991, or as subsequently amended, (B)
any "waste" as defined in subdivision (d) of Section 13050 of the
Water Code as effective on January 1, 1991, or as subsequently
amended, or (C) petroleum, including crude oil or any fraction
thereof, natural gas, natural gas liquids, liquefied natural gas, or
synthetic gas usable for fuel, or any mixture thereof.
   (3) "Real property security" means any real property and
improvements, other than a separate interest and any related interest
in the common area of a residential common interest development, as
the terms "separate interest," "common area," and "common interest
development" are defined in Section 1351, or real property consisting
of one acre or less which contains 1 to 15 dwelling units.
   (4) "Release" means any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching,
dumping, or disposing into the environment, including continuing
migration, of hazardous substances into, onto, or through soil,
surface water, or groundwater.
   (5) "Secured lender" means the beneficiary under a deed of trust
against the real property security, or the mortgagee under a mortgage
against the real property security, and any successor-in-interest of
the beneficiary or mortgagee to the deed of trust or mortgage.



(2930.) Section Twenty-nine Hundred and Thirty.  Title acquired by
the mortgagor subsequent to the execution of the mortgage, inures to
the mortgagee as security for the debt in like manner as if acquired
before the execution.


2931.  A mortgagee may foreclose the right of redemption of the
mortgagor in the manner prescribed by the CODE OF CIVIL PROCEDURE.



2931a.  In any action brought to determine conflicting claims to
real property, or for partition of real property or an estate for
years therein, or to foreclose a deed of trust, mortgage, or other
lien upon real property, or in all eminent domain proceedings under
Section 1250.110 et seq., of the Code of Civil Procedure against real
property upon which exists a lien to secure the payment of taxes or
other obligations to an agency of the State of California, other than
ad valorem taxes upon the real property, the state agency charged
with the collection of the tax obligation may be made a party.  In
such an action, the court shall have jurisdiction to determine the
priority and effect of the liens described in the complaint in or
upon the real property or estate for years therein, but the
jurisdiction of the court in the action shall not include a
determination of the validity of the tax giving rise to the lien or
claim of lien.  The complaint or petition in the action shall contain
a description of the lien sufficient to enable the tax or other
obligation, payment of which it secures, to be identified with
certainty, and shall include the name and address of the person owing
the tax or other obligation, the name of the state agency that
recorded the lien, and the date and place where the lien was
recorded.  Services of process in the action shall be made upon the
agency, officer, board, commission, department, division, or other
body charged with the collection of the tax or obligation.  It shall
be the duty of the Attorney General to represent the state agency in
the action.



2931b.  In all actions in which the State of California is named a
party pursuant to the provisions of Section 2931a and in which real
property or an estate for years therein is sought to be sold, the
Attorney General may, with the consent of the Department of Finance,
bid upon and purchase that real property or estate for years.




2931c.  The Attorney General may bring an action in the courts of
this or any other state or of the United States to enforce any lien
to secure the payment of taxes or other obligations to the State of
California under the Unemployment Insurance Code, the Revenue and
Taxation Code, or Chapter 6 (commencing with Section 16180) of Part 1
of Division 4 of Title 2 of the Government Code or to subject to
payment of the liability giving rise to the lien any property in
which the debtor has any right, title, or interest.  In any action
brought under this section the court shall have jurisdiction to
determine the priority and effect of the lien in or upon the
property, but the jurisdiction of the court in such action shall not
extend to a determination of the validity of the liability giving
rise to the lien.



2932.  A power of sale may be conferred by a mortgage upon the
mortgagee or any other person, to be exercised after a breach of the
obligation for which the mortgage is a security.



2932.5.  Where a power to sell real property is given to a
mortgagee, or other encumbrancer, in an instrument intended to secure
the payment of money, the power is part of the security and vests in
any person who by assignment becomes entitled to payment of the
money secured by the instrument.  The power of sale may be exercised
by the assignee if the assignment is duly acknowledged and recorded.




2932.6.  (a) Notwithstanding any other provision of law, a financial
institution may undertake to repair any property acquired through
foreclosure under a mortgage or deed of trust.
   (b) As used in this section, the term "financial institution"
includes, but is not limited to, banks, savings associations, credit
unions, and industrial loan companies.
   (c) The rights granted to a financial institution by this section
are in addition to, and not in derogation of, the rights of a
financial institution which otherwise exist.



2933.  A power of attorney to execute a mortgage must be in writing,
subscribed, acknowledged, or proved, certified, and recorded in like
manner as powers of attorney for grants of real property.



2934.  Any assignment of a mortgage and any assignment of the
beneficial interest under a deed of trust may be recorded, and from
the time the same is filed for record operates as constructive notice
of the contents thereof to all persons; and any instrument by which
any mortgage or deed of trust of, lien upon or interest in real
property, (or by which any mortgage of, lien upon or interest in
personal property a document evidencing or creating which is required
or permitted by law to be recorded), is subordinated or waived as to
priority may be recorded, and from the time the same is filed for
record operates as constructive notice of the contents thereof, to
all persons.



2934a.  (a) (1) The trustee under a trust deed upon real property or
an estate for years therein given to secure an obligation to pay
money and conferring no other duties upon the trustee than those
which are incidental to the exercise of the power of sale therein
conferred, may be substituted by the recording in the county in which
the property is located of a substitution executed and acknowledged
by:  (A) all of the beneficiaries under the trust deed, or their
successors in interest, and the substitution shall be effective
notwithstanding any contrary provision in any trust deed executed on
or after January 1, 1968; or (B) the holders of more than 50 percent
of the record beneficial interest of a series of notes secured by the
same real property or of undivided interests in a note secured by
real property equivalent to a series transaction, exclusive of any
notes or interests of a licensed real estate broker that is the
issuer or servicer of the notes or interests or of any affiliate of
that licensed real estate broker.
   (2) A substitution executed pursuant to subparagraph (B) of
paragraph (1) is not effective unless all the parties signing the
substitution sign, under penalty of perjury, a separate written
document stating the following:
   (A) The substitution has been signed pursuant to subparagraph (B)
of paragraph (1).
   (B) None of the undersigned is a licensed real estate broker or an
affiliate of the broker that is the issuer or servicer of the
obligation secured by the deed of trust.
   (C) The undersigned together hold more than 50 percent of the
record beneficial interest of a series of notes secured by the same
real property or of undivided interests in a note secured by real
property equivalent to a series transaction.
   (D) Notice of the substitution was sent by certified mail, postage
prepaid, with return receipt requested to each holder of an interest
in the obligation secured by the deed of trust who has not joined in
the execution of the substitution or the separate document.
   The separate document shall be attached to the substitution and be
recorded in the office of the county recorder of each county in
which the real property described in the deed of trust is located.
Once the document required by this paragraph is recorded, it shall
constitute conclusive evidence of compliance with the requirements of
this paragraph in favor of substituted trustees acting pursuant to
this section, subsequent assignees of the obligation secured by the
deed of trust, and subsequent bona fide purchasers or encumbrancers
for value of the real property described therein.
   (3) For purposes of this section, "affiliate of the licensed real
estate broker" includes any person as defined in Section 25013 of the
Corporations Code that is controlled by, or is under common control
with, or who controls, a licensed real estate broker.  "Control"
means the possession, direct or indirect, of the power to direct or
cause the direction of management and policies.
   (4) The substitution shall contain the date of recordation of the
trust deed, the name of the trustor, the book and page or instrument
number where the trust deed is recorded, and the name of the new
trustee.  From the time the substitution is filed for record, the new
trustee shall succeed to all the powers, duties, authority, and
title granted and delegated to the trustee named in the deed of
trust.  A substitution may be accomplished, with respect to multiple
deeds of trust which are recorded in the same county in which the
substitution is being recorded and which all have the same trustee
and beneficiary or beneficiaries, by recording a single document,
complying with the requirements of this section, substituting
trustees for all those deeds of trust.
   (b) If the substitution is effected after a notice of default has
been recorded but prior to the recording of the notice of sale, the
beneficiary or beneficiaries shall cause a copy of the substitution
to be mailed, prior to the recording thereof, in the manner provided
in Section 2924b, to the trustee then of record and to all persons to
whom a copy of the notice of default would be required to be mailed
by the provisions of Section 2924b.  An affidavit shall be attached
to the substitution that notice has been given to those persons and
in the manner required by this subdivision.
   (c) Notwithstanding any provision of this section or any provision
in any deed of trust, unless a new notice of sale containing the
name, street address, and telephone number of the substituted trustee
is given pursuant to Section 2924f, any sale conducted by the
substituted trustee shall be void.
   (d) This section shall remain in effect only until January 1,
1998, and shall have no force or effect after that date, unless a
later enacted statute, which is enacted before January 1, 1998,
deletes or extends that date.



2934a.  (a) (1) The trustee under a trust deed upon real property or
an estate for years therein given to secure an obligation to pay
money and conferring no other duties upon the trustee than those
which are incidental to the exercise of the power of sale therein
conferred, may be substituted by the recording in the county in which
the property is located of a substitution executed and acknowledged
by:  (A) all of the beneficiaries under the trust deed, or their
successors in interest, and the substitution shall be effective
notwithstanding any contrary provision in any trust deed executed on
or after January 1, 1968; or (B) the holders of more than 50 percent
of the record beneficial interest of a series of notes secured by the
same real property or of undivided interests in a note secured by
real property equivalent to a series transaction, exclusive of any
notes or interests of a licensed real estate broker that is the
issuer or servicer of the notes or interests or of any affiliate of
that licensed real estate broker.
   (2) A substitution executed pursuant to subparagraph (B) of
paragraph (1) is not effective unless all the parties signing the
substitution sign, under penalty of perjury, a separate written
document stating the following:
   (A) The substitution has been signed pursuant to subparagraph (B)
of paragraph (1).
   (B) None of the undersigned is a licensed real estate broker or an
affiliate of the broker that is the issuer or servicer of the
obligation secured by the deed of trust.
   (C) The undersigned together hold more than 50 percent of the
record beneficial interest of a series of notes secured by the same
real property or of undivided interests in a note secured by real
property equivalent to a series transaction.
   (D) Notice of the substitution was sent by certified mail, postage
prepaid, with return receipt requested to each holder of an interest
in the obligation secured by the deed of trust who has not joined in
the execution of the substitution or the separate document.
   The separate document shall be attached to the substitution and be
recorded in the office of the county recorder of each county in
which the real property described in the deed of trust is located.
Once the document required by this paragraph is recorded, it shall
constitute conclusive evidence of compliance with the requirements of
this paragraph in favor of substituted trustees acting pursuant to
this section, subsequent assignees of the obligation secured by the
deed of trust and subsequent bona fide purchasers or encumbrancers
for value of the real property described therein.
   (3) For purposes of this section, "affiliate of the licensed real
estate broker" includes any person as defined in Section 25013 of the
Corporations Code that is controlled by, or is under common control
with, or who controls, a licensed real estate broker.  "Control"
means the possession, direct or indirect, of the power to direct or
cause the direction of management and policies.
   (4) The substitution shall contain the date of recordation of the
trust deed, the name of the trustor, the book and page or instrument
number where the trust deed is recorded, and the name of the new
trustee.  From the time the substitution is filed for record, the new
trustee shall succeed to all the powers, duties, authority, and
title granted and delegated to the trustee named in the deed of
trust.  A substitution may be accomplished, with respect to multiple
deeds of trust which are recorded in the same county in which the
substitution is being recorded and which all have the same trustee
and beneficiary or beneficiaries, by recording a single document,
complying with the requirements of this section, substituting
trustees for all those deeds of trust.
   (b) If the substitution is effected after a notice of default has
been recorded but prior to the recording of the notice of sale, the
beneficiary or beneficiaries or their authorized agents shall cause a
copy of the substitution to be mailed, prior to the recording
thereof, in the manner provided in Section 2924b, to the trustee then
of record and to all persons to whom a copy of the notice of default
would be required to be mailed by the provisions of Section 2924b.
An affidavit shall be attached to the substitution that notice has
been given to those persons and in the manner required by this
subdivision.
   (c) Notwithstanding any provision of this section or any provision
in any deed of trust, unless a new notice of sale containing the
name, street address, and telephone number of the substituted trustee
is given pursuant to Section 2924f, any sale conducted by the
substituted trustee shall be void.
   (d) This section shall become operative on January 1, 1998.



2934b.  Sections 15643 and 18102 of the Probate Code apply to
trustees under deeds of trust given to secure obligations.



2935.  When a mortgage or deed of trust is executed as security for
money due or to become due, on a promissory note, bond, or other
instrument, designated in the mortgage or deed of trust, the record
of the assignment of the mortgage or of the assignment of the
beneficial interest under the deed of trust, is not of itself notice
to the debtor, his heirs, or personal representatives, so as to
invalidate any payment made by them, or any of them, to the person
holding such note, bond, or other instrument.



2936.  The assignment of a debt secured by mortgage carries with it
the security.



2937.  (a) The Legislature hereby finds and declares that borrowers
or subsequent obligors have the right to know when a person holding a
promissory note, bond, or other instrument transfers servicing of
the indebtedness secured by a mortgage or deed of trust on real
property containing one to four residential units located in this
state.  The Legislature also finds that notification to the borrower
or subsequent obligor of the transfer may protect the borrower or
subsequent obligor from fraudulent business practices and may ensure
timely payments.
   It is the intent of the Legislature in enacting this section to
mandate that a borrower or subsequent obligor be given written notice
when a person transfers the servicing of the indebtedness on notes,
bonds, or other instruments secured by a mortgage or deed of trust on
real property containing one to four residential units and located
in this state.
   (b) Any person transferring the servicing of indebtedness  as
provided in subdivision (a) to a different servicing agent and any
person assuming from another responsibility for servicing the
instrument evidencing indebtedness, shall give written notice to the
borrower or subsequent obligor before the borrower or subsequent
obligor becomes obligated to make payments to a new servicing agent.

   (c) In the event a notice of default has been recorded or a
judicial foreclosure proceeding has been commenced, the person
transferring the servicing of the indebtedness and the person
assuming from another the duty of servicing the indebtedness shall
give written notice to the trustee or attorney named in the notice of
default or judicial foreclosure of the transfer.  A notice of
default, notice of sale, or judicial foreclosure shall not be
invalidated solely because the servicing agent is changed during the
foreclosure process.
   (d) The notices required by subdivision (b) shall be sent by
first-class mail, postage prepaid, to the borrower's or subsequent
obligor's address designated for loan payment billings, or if escrow
is pending, as provided in the escrow, and shall contain each of the
following:
   (1) The name and address of the person to which the transfer of
the servicing of the indebtedness is made.
   (2) The date the transfer was or will be completed.
   (3) The address where all payments pursuant to the transfer are to
be made.
   (e) Any person assuming from another responsibility for servicing
the instrument evidencing indebtedness shall include in the notice
required by subdivision (b) a statement of the due date of the next
payment.
   (f) The borrower or subsequent obligor shall not be liable to the
holder of the note, bond, or other instrument or to any servicing
agent for payments made to the previous servicing agent or for late
charges if these payments were made prior to the borrower or
subsequent obligor receiving written notice of the transfer as
provided by subdivision (d) and the payments were otherwise on time.

   (g) For purposes of this section, the term servicing agent shall
not include a trustee exercising a power of sale pursuant to a deed
of trust.



2937.7.  In any action affecting the interest of any trustor or
beneficiary under a deed of trust or mortgage, service of process to
the trustee does not constitute service to the trustor or beneficiary
and does not impose any obligation on the trustee to notify the
trustor or beneficiary of the action.



2938.  (a) A written assignment of an interest in leases, rents,
issues, or profits of real property made in connection with an
obligation secured by real property, irrespective of whether the
assignment is denoted as absolute, absolute conditioned upon default,
additional security for an obligation, or otherwise, shall, upon
execution and delivery by the assignor, be effective to create a
present security interest in existing and future leases, rents,
issues, or profits of that real property.  As used in this section,
"leases, rents, issues, and profits of real property" include the
cash proceeds thereof.  The term "cash proceeds" means cash, checks,
deposit accounts, and the like.
   (b) An assignment of an interest in leases, rents, issues, or
profits of real property may be recorded in the records of the county
recorder in which the underlying real property is located in the
same manner as any other conveyance of an interest in real property,
whether the assignment is in a separate document or part of a
mortgage or deed of trust, and when so duly recorded in accordance
with the methods, procedures, and requirements for recordation of
conveyances of other interests in real property, (1) the assignment
shall be deemed to give constructive notice of the content of the
assignment with the same force and effect as any other duly recorded
conveyance of an interest in real property and (2) the interest
granted by the assignment shall be deemed fully perfected as of the
time of recordation with the same force and effect as any other duly
recorded conveyance of an interest in real property, notwithstanding
any provision of the assignment or any provision of law that would
otherwise preclude or defer enforcement of the rights granted the
assignee under the assignment until the occurrence of a subsequent
event, including, but not limited to, a subsequent default of the
assignor, or the assignee's obtaining possession of the real property
or the appointment of a receiver.
   (c) Upon default of the assignor under the obligation secured by
the assignment of leases, rents, issues, and profits, the assignee
shall be entitled to enforce the assignment in accordance with this
section.  On and after the date the assignee takes one or more of the
enforcement steps described in this subdivision, the assignee shall
be entitled to collect and receive all rents, issues, and profits
that have accrued but remain unpaid and uncollected by the assignor
or its agent or for the assignor's benefit on that date, and all
rents, issues, and profits that accrue on or after the date.  The
assignment shall be enforced by one or more of the following:
   (1) The appointment of a receiver.
   (2) Obtaining possession of the rents, issues, or profits.
   (3) Delivery to any one or more of the tenants of a written demand
for turnover of rents, issues, and profits in the form specified in
subdivision (j), a copy of which demand shall also be delivered to
the assignor; and a copy of which shall be mailed to all other
assignees of record of the leases, rents, issues, and profits of the
real property at the address for notices provided in the assignment
or, if none, to the address to which the recorded assignment was to
be mailed after recording.
   (4) Delivery to the assignor of a written demand for the rents,
issues, or profits, a copy of which shall be mailed to all other
assignees of record of the leases, rents, issues, and profits of the
real property at the address for notices provided in the assignment
or, if none, to the address to which the recorded assignment was to
be mailed after recording.
   Moneys received by the assignee pursuant to this subdivision, net
of amounts paid pursuant to subdivision (g), if any, shall be applied
by the assignee to the debt or otherwise in accordance with the
assignment or the promissory note, deed of trust, or other instrument
evidencing the obligation; provided, however, that neither the
application nor the failure to so apply the rents, issues, or profits
shall result in a loss of any lien or security interest which the
assignee may have in the underlying real property or any other
collateral, render the obligation unenforceable, constitute a
violation of Section 726 of the Code of Civil Procedure, or otherwise
limit any right available to the assignee with respect to its
security.
   (d) If an assignee elects to take the action provided for under
paragraph (3) of subdivision (c), the demand provided for therein
shall be signed under penalty of perjury by the assignee or an
authorized agent of the assignee and shall be effective as against
the tenant when actually received by the tenant at the address for
notices provided under the lease or other contractual agreement under
which the tenant occupies the property or, if no address for notices
is so provided, at the property.  Upon receipt of this demand, the
tenant shall be obligated to pay to the assignee all rents, issues,
and profits that are past due and payable on the date of receipt of
the demand, and all rents, issues, and profits coming due under the
lease following the date of receipt of the demand, unless either of
the following occurs:
   (1) The tenant has previously received a demand which is valid on
its face from another assignee of the leases, issues, rents, and
profits sent by the other assignee in accordance with this
subdivision and subdivision (c).
   (2) The tenant, in good faith and in a manner which is not
inconsistent with the lease, has previously paid, or within 10 days
following receipt of the demand notice pays, the rent to the
assignor.
   Payment of rent to an assignee following a demand under an
assignment of leases, rents, issues, and profits shall satisfy the
tenant's obligation to pay the amounts under the lease.  If a tenant
pays rent to the assignor after receipt of a demand other than under
the circumstances described in this subdivision, the tenant shall not
be discharged of the obligation to pay rent to the assignee, unless
the tenant occupies the property for residential purposes.  The
obligation of a tenant to pay rent pursuant to this subdivision and
subdivision (c) shall continue until receipt by the tenant of a
written notice from a court directing the tenant to pay the rent in a
different manner or receipt by the tenant of a written notice from
the assignee from whom the demand was received canceling the demand,
whichever occurs first.  Nothing in this subdivision shall affect the
entitlement to rents, issues, or profits as between assignees as set
forth in subdivision (h).
   (e) No enforcement action of the type authorized by subdivision
(c), and no collection, distribution, or application of rents,
issues, or profits by the assignee following an enforcement action of
the type authorized by subdivision (c), shall do any of the
following:
   (1) Make the assignee a mortgagee in possession of the property,
except if the assignee obtains actual possession of the real
property, or an agent of the assignor.
   (2) Constitute an action, render the obligation unenforceable,
violate Section 726 of the Code of Civil Procedure or, other than
with respect to marshaling requirements, otherwise limit any rights
available to the assignee with respect to its security.
   (3) Be deemed to create any bar to a deficiency judgment pursuant
to any provision of law governing or relating to deficiency judgments
following the enforcement of any encumbrance, lien, or security
interest, notwithstanding that the action, collection, distribution,
or application may reduce the indebtedness secured by the assignment
or by any deed of trust or other security instrument.
   The application of rents, issues, or profits to the secured
obligation shall satisfy the secured obligation to the extent of
those rents, issues, or profits, and, notwithstanding any provisions
of the assignment or other loan documents to the contrary, shall be
credited against any amounts necessary to cure any monetary default
for purposes of reinstatement under Section 2924c.
   (f) If cash proceeds of rents, issues or profits to which the
assignee is entitled following enforcement as set forth in
subdivision (c) are received by the assignor or its agent for
collection or by any other person who has collected such rents,
issues, or profits for the assignor's benefit, or for the benefit of
any subsequent assignee under the circumstances described in
subdivision (h), following the taking by the assignee of either of
the enforcement actions authorized in paragraph (3) or (4) of
subdivision (c), and the assignee has not authorized the assignor's
disposition of the cash proceeds in a writing signed by the assignee,
the rights to the cash proceeds and to the recovery of the cash
proceeds shall be determined by the following:
   (1) The assignee shall be entitled to an immediate turnover of the
cash proceeds received by the assignor or its agent for collection
or any other person who has collected the rents, issues, or profits
for the assignor's benefit, or for the benefit of any subsequent
assignee under the circumstances described in subdivision (h), and
the assignor or other described party in possession of such cash
proceeds shall turn over the full amount of cash proceeds to the
assignee, less any amount representing payment of expenses authorized
by the assignee in writing.  The assignee shall have a right to
bring an action for recovery of the cash proceeds, and to recover the
cash proceeds, without the necessity of bringing an action to
foreclose any security interest which it may have in the real
property.  This action shall not violate Section 726 of the Code of
Civil Procedure or otherwise limit any right available to the
assignee with respect to its security.
   (2) As between an assignee with an interest in cash proceeds
perfected in the manner set forth in subdivision (b) and enforced in
accordance with paragraph (3) or (4) of subdivision (c) and any other
person claiming an interest in the cash proceeds, other than the
assignor or its agent for collection or one collecting rents, issues,
and profits for the benefit of the assignor, and subject to
subdivision (h), the assignee shall have a continuously perfected
security interest in the cash proceeds to the extent that the cash
proceeds are identifiable.  For purposes hereof, cash proceeds are
identifiable if they are either (A) segregated or (B) if commingled
with other funds of the assignor or its agent or one acting on its
behalf, can be traced using the lowest intermediate balance
principle, unless the assignor or other party claiming an interest in
proceeds shows that some other method of tracing would better serve
the interests of justice and equity under the circumstances of the
case.  The provisions of this paragraph are subject to any generally
applicable law with respect to payments made in the operation of the
assignor's business.
   (g) (1) If the assignee enforces the assignment under subdivision
(c) by any means other than the appointment of a receiver and
receives rents, issues, or profits pursuant to this enforcement, the
assignor or any other assignee of the affected real property may make
written demand upon the assignee to pay the reasonable costs of
protecting and preserving the property, including payment of taxes
and insurance and compliance with building and housing codes, if any.

   (2) On and after the date of receipt of the demand, the assignee
shall pay for the reasonable costs of protecting and preserving the
real property to the extent of any rents, issues, or profits actually
received by the assignee; provided, however, that no such acts by
the assignee shall cause the assignee to become a mortgagee in
possession and the assignee's duties under this subdivision, upon
receipt of a demand from the assignor or any other assignee of the
leases, rents, issues, and profits pursuant to paragraph (1), shall
not be construed to require the assignee to operate or manage the
property, which obligation shall remain that of the assignor.
   (3) The obligation of the assignee hereunder shall continue until
the earlier of (A) the date on which the assignee obtains the
appointment of a receiver for the real property pursuant to
application to a court of competent jurisdiction, or (B) the date on
which the assignee ceases to enforce the assignment.
   (4) Nothing in this subdivision shall be construed to supersede or
diminish the right of the assignee to the appointment of a receiver.

   (h) The lien priorities, rights, and interests among creditors
concerning rents, issues, or profits collected before the enforcement
by the assignee shall be governed by subdivisions (a) and (b).
Without limiting the generality of the foregoing, if an assignee who
has recorded its interest in leases, rents, issues, and profits prior
to the recordation of such interest by a subsequent assignee seeks
to enforce its interest in those rents, issues, or profits in
accordance with this section after any enforcement action has been
taken by a subsequent assignee, the prior assignee shall be entitled
only to the rents, issues, and profits that are accrued and unpaid as
of the date of its enforcement action and unpaid rents, issues, and
profits accruing thereafter.  The prior assignee shall have no right
to rents, issues, or profits paid prior to the date of the
enforcement action, whether in the hands of the assignor or any
subsequent assignee.  Upon receipt of notice that the prior assignee
has enforced its interest in the rents, issues, and profits, the
subsequent assignee shall immediately send a notice to any tenant to
whom it has given notice under subdivision (c).  The notice shall
inform the tenant that the subsequent assignee cancels its demand
that the tenant pay rent to the subsequent assignee.
   (i) This section shall apply to contracts entered into on or after
January 1, 1997.
   Sections 2938 and 2938.1, as these sections were in effect prior
to January 1, 1997, shall govern contracts entered into prior to
January 1, 1997, and shall govern actions and proceedings initiated
on the basis of these contracts.
   (j) "Real property," as used in this section, shall mean real
property or any estate or interest therein.
   (k) The demand required by paragraph (3) of subdivision (c) shall
be in the following form:
      DEMAND TO PAY RENT TO
PARTY OTHER THAN LANDLORD
(SECTION 2938 OF THE CIVIL CODE)
    Tenant:  (Name of Tenant)
      Property Occupied by Tenant:  (Address)
      Landlord:  (Name of Landlord)
      Secured Party:  (Name of Secured Party)
      Address:  (Address for Payment of Rent to Secured Party and for
Further Information):
      The secured party named above is the assignee of leases, rents,
issues, and profits under (name of document) dated ______, and
recorded at (recording information) in the official records of
___________ County, California.  You may request a copy of such
assignment from the secured party at ____ (address).
      THIS NOTICE AFFECTS YOUR LEASE OR RENTAL AGREEMENT RIGHTS AND
OBLIGATIONS.  YOU ARE THEREFORE ADVISED TO CONSULT AN ATTORNEY
CONCERNING THOSE RIGHTS AND OBLIGATIONS IF YOU HAVE ANY QUESTIONS
REGARDING YOUR RIGHTS AND OBLIGATIONS UNDER THIS NOTICE.
      IN ACCORDANCE WITH SUBDIVISION (C) OF SECTION 2938 OF THE CIVIL
CODE, YOU ARE HEREBY DIRECTED TO PAY TO THE SECURED PARTY, ____
(NAME OF SECURED PARTY) AT ____ (ADDRESS), ALL RENTS UNDER YOUR LEASE
OR OTHER RENTAL AGREEMENT WITH THE LANDLORD OR PREDECESSOR IN
INTEREST OF LANDLORD, FOR THE OCCUPANCY OF THE PROPERTY AT ____
(ADDRESS OF RENTAL PREMISES) WHICH ARE PAST DUE AND PAYABLE ON THE
DATE YOU RECEIVE THIS DEMAND, AND ALL RENTS COMING DUE UNDER THE
LEASE OR OTHER RENTAL AGREEMENT FOLLOWING THE DATE YOU RECEIVE THIS
DEMAND UNLESS YOU HAVE ALREADY PAID THIS RENT TO THE LANDLORD IN GOOD
FAITH AND IN A MANNER NOT INCONSISTENT WITH THE AGREEMENT BETWEEN
YOU AND THE LANDLORD.  IN THIS CASE, THIS DEMAND NOTICE SHALL REQUIRE
YOU TO PAY TO THE SECURED PARTY ____, (NAME OF THE SECURED PARTY),
ALL RENTS THAT COME DUE FOLLOWING THE DATE OF THE PAYMENT TO THE
LANDLORD.
      IF YOU PAY THE RENT TO THE UNDERSIGNED SECURED PARTY, ____
(NAME OF SECURED PARTY), IN ACCORDANCE WITH THIS NOTICE, YOU DO NOT
HAVE TO PAY THE RENT TO THE LANDLORD.  YOU WILL NOT BE SUBJECT TO
DAMAGES OR OBLIGATED TO PAY RENT TO THE SECURED PARTY IF YOU HAVE
PREVIOUSLY RECEIVED A DEMAND OF THIS TYPE FROM A DIFFERENT SECURED
PARTY.
      (For other than residential tenants).  IF YOU PAY ANY RENT TO
THE LANDLORD THAT BY THE TERMS OF THIS DEMAND YOU ARE REQUIRED TO PAY
TO THE SECURED PARTY, YOU MAY BE SUBJECT TO DAMAGES INCURRED BY THE
SECURED PARTY BY REASON OF YOUR FAILURE TO COMPLY WITH THIS DEMAND,
AND YOU MAY NOT BE DISCHARGED FROM YOUR OBLIGATION TO PAY SUCH RENT
TO THE SECURED PARTY.  YOU WILL NOT BE SUBJECT TO SUCH DAMAGES OR
OBLIGATED TO PAY SUCH RENT TO THE SECURED PARTY IF YOU HAVE
PREVIOUSLY RECEIVED A DEMAND OF THIS TYPE FROM A DIFFERENT ASSIGNEE.

      Your obligation to pay rent under this demand shall continue
until you receive either (1) a written notice from a court directing
you to pay the rent in a manner provided therein, or (2) a written
notice from the secured party named above canceling this demand.
      The undersigned hereby certifies, under penalty of perjury,
that the undersigned is an authorized officer or agent of the secured
party and that the secured party is the assignee, or the current
successor to the assignee, under an assignment of leases, rents,
issues, or profits executed by the landlord, or a predecessor in
interest, that is being enforced pursuant to and in accordance with
Section 2938 of the Civil Code.
      Executed at _________, California, this ____ day of _________,
_____.


                             (Secured Party)

                             Name: _____________________________

                             Title: ____________________________




2939.  A recorded mortgage must be discharged by a certificate
signed by the mortgagee, his personal representatives or assigns,
acknowledged or proved and certified as prescribed by the chapter on
"recording transfers," stating that the mortgage has been paid,
satisfied, or discharged.  Reference shall be made in said
certificate to the book and page where the mortgage is recorded.



2939.5.  Foreign executors, administrators and guardians may satisfy
mortgages upon the records of any county in this state, upon
producing and recording in the office of the county recorder of the
county in which such mortgage is recorded, a duly certified and
authenticated copy of their letters testamentary, or of
administration or of guardianship, and which certificate or
authentication shall also recite that said letters have not been
revoked.  For the purposes of this section, "guardian" includes a
foreign conservator, committee, or comparable fiduciary.




2940.  A certificate of the discharge of a mortgage, and the proof
or acknowledgment thereof, must be recorded in the office of the
county recorder in which the mortgage is recorded.



2941.  (a) Within 30 days after any mortgage has been satisfied, the
mortgagee or the assignee of the mortgagee shall execute a
certificate of the discharge thereof, as provided in Section 2939,
and shall record or cause to be recorded in the office of the county
recorder in which the mortgage is recorded.  The mortgagee shall then
deliver, upon the written request of the mortgagor or the mortgagor'
s heirs, successors, or assignees, as the case may be, the original
note and mortgage to the person making the request.
   (b) (1) Within 30 calendar days after the obligation secured by
any deed of trust has been satisfied, the beneficiary or the assignee
of the beneficiary shall execute and deliver to the trustee the
original note, deed of trust, request for a full reconveyance, and
other documents as may be necessary to reconvey, or cause to be
reconveyed, the deed of trust.
   (A) The trustee shall execute the full reconveyance and shall
record or cause it to be recorded in the office of the county
recorder in which the deed of trust is recorded within 21 calendar
days after receipt by the trustee of the original note, deed of
trust, request for a full reconveyance, the fee that may be charged
pursuant to subdivision (e), recorder's fees, and other documents as
may be necessary to reconvey, or cause to be reconveyed, the deed of
trust.
   (B) The trustee shall deliver a copy of the reconveyance to the
beneficiary, its successor in interest, or its servicing agent, if
known.  The reconveyance instrument shall specify the trustor as the
person to whom the recorder will deliver the recorded instrument
pursuant to Section 27321 of the Government Code.
   (C) Following execution and recordation of the full reconveyance,
upon receipt of a written request by the trustor or the trustor's
heirs, successors, or assignees, the trustee shall then deliver, or
caused to be delivered, the original note and deed of trust to the
person making that request.
   (D) If the note or deed of trust, or any copy of the note or deed
of trust, is electronic, upon satisfaction of an obligation secured
by a deed of trust, any electronic original, or electronic copy which
has not been previously marked solely for use as a copy, of the note
and deed of trust, shall be altered to indicate that the obligation
is paid in full.
   (2) If the trustee has failed to execute and record, or cause to
be recorded, the full reconveyance within 60 calendar days of
satisfaction of the obligation, the beneficiary, upon receipt of a
written request by the trustor or trustor's heirs, successor in
interest, agent, or assignee, shall execute and acknowledge a
document pursuant to Section 2934a substituting itself or another as
trustee and issue a full reconveyance.
   (3) If a full reconveyance has not been executed and recorded
pursuant to either paragraph (1) or paragraph (2) within 75 calendar
days of satisfaction of the obligation, then a title insurance
company may prepare and record a release of the obligation.  However,
at least 10 days prior to the issuance and recording of a full
release pursuant to this paragraph, the title insurance company shall
mail by first-class mail with postage prepaid, the intention to
release the obligation to the trustee, trustor, and beneficiary of
record, or their successor in interest of record, at the last known
address.
   (A) The release shall set forth:
   (i) The name of the beneficiary.
   (ii) The name of the trustor.
   (iii) The recording reference to the deed of trust.
   (iv) A recital that the obligation secured by the deed of trust
has been paid in full.
   (v) The date and amount of payment.
   (B) The release issued pursuant to this subdivision shall be
entitled to recordation and, when recorded, shall be deemed to be the
equivalent of a reconveyance of a deed of trust.
   (4) Where an obligation secured by a deed of trust was paid in
full prior to July 1, 1989, and no reconveyance has been issued and
recorded by October 1, 1989, then a release of obligation as provided
for in paragraph (3) may be issued.
   (5) Paragraphs (2) and (3) do not excuse the beneficiary or the
trustee from compliance with paragraph (1).  Paragraph (3) does not
excuse the beneficiary from compliance with paragraph (2).
   (6) In addition to any other remedy provided by law, a title
insurance company preparing or recording the release of the
obligation shall be liable to any party for damages, including
attorneys' fees, which any person may sustain by reason of the
issuance and recording of the release, pursuant to paragraphs (3) and
(4).
   (7) A beneficiary may, at its discretion, in accordance with the
requirements and procedures of Section 2934a, substitute the title
company conducting the escrow through which the obligation is
satisfied for the trustee of record, in which case the title company
assumes the obligation of a trustee under this subdivision, and may
collect the fee authorized by subdivision (e).
   (8) In lieu of delivering the original note and deed of trust to
the trustee within 30 days of loan satisfaction, as required by
paragraph (1) of subdivision (b), a beneficiary who executes and
delivers to the trustee a request for a full reconveyance within 30
days of loan satisfaction may, within 120 days of loan satisfaction,
deliver the original note and deed of trust to either the trustee or
trustor.  If the note and deed of trust are delivered as provided in
this paragraph, upon satisfaction of the note and deed of trust, the
note and deed of trust shall be altered to indicate that the
obligation is paid in full.  Nothing in this paragraph alters the
requirements and obligations set forth in paragraphs (2) and (3).
   (c) For the purposes of this section, the phrases "cause to be
recorded" and "cause it to be recorded" include, but are not limited
to, sending by certified mail with the United States Postal Service
or by an independent courier service using its tracking service that
provides documentation of receipt and delivery, including the
signature of the recipient, the full reconveyance or certificate of
discharge in a recordable form, together with payment for all
required fees, in an envelope addressed to the county recorder's
office of the county in which the deed of trust or mortgage is
recorded.  Within two business days from the day of receipt, if
received in recordable form together with all required fees, the
county recorder shall stamp and record the full reconveyance or
certificate of discharge.  Compliance with this subdivision shall
entitle the trustee to the benefit of the presumption found in
Section 641 of the Evidence Code.
   (d) The violation of this section shall make the violator liable
to the person affected by the violation for all damages which that
person may sustain by reason of the violation, and shall require that
the violator forfeit to that person the sum of five hundred dollars
($500).
   (e) (1) The trustee, beneficiary, or mortgagee may charge a
reasonable fee to the trustor or mortgagor, or the owner of the land,
as the case may be, for all services involved in the preparation,
execution, and recordation of the full reconveyance, including, but
not limited to, document preparation and forwarding services rendered
to effect the full reconveyance, and, in addition, may collect
official fees.  This fee may be made payable no earlier than the
opening of a bona fide escrow or no more than 60 days prior to the
full satisfaction of the obligation secured by the deed of trust or
mortgage.
   (2) If the fee charged pursuant to this subdivision does not
exceed forty-five dollars ($45), the fee is conclusively presumed to
be reasonable.
   (3) The fee described in paragraph (1) may not be charged unless
demand for the fee was included in the payoff demand statement
described in Section 2943.
   (f) For purposes of this section, "original" may include an
optically imaged reproduction when the following requirements are
met:
   (1) The trustee receiving the request for reconveyance and
executing the reconveyance as provided in subdivision (b) is an
affiliate or subsidiary of the beneficiary or an affiliate or
subsidiary of the assignee of the beneficiary, respectively.
   (2) The optical image storage media used to store the document
shall be nonerasable write once, read many (WORM) optical image media
that does not allow changes to the stored document.
   (3) The optical image reproduction shall be made consistent with
the minimum standards of quality approved by either the National
Institute of Standards and Technology or the Association for
Information and Image Management.
   (4) Written authentication identifying the optical image
reproduction as an unaltered copy of the note, deed of trust, or
mortgage shall be stamped or printed on the optical image
reproduction.
   (g) No fee or charge may be imposed on the trustor in connection
with, or relating to, any act described in this section except as
expressly authorized by this section.
   (h) The amendments to this section enacted at the 1999-2000
Regular Session shall apply only to a mortgage or an obligation
secured by a deed of trust that is satisfied on or after January 1,
2001.
   (i) (1) In any action filed before January 1, 2002, that is
dismissed as a result of the amendments to this section enacted at
the 2001-02 Regular Session, the plaintiff shall not be required to
pay the defendant's costs.
   (2) Any claimant, including a claimant in a class action lawsuit,
whose claim is dismissed or barred as a result of the amendments to
this section enacted at the 2001-02 Regular Session, may, within 6
months of the dismissal or barring of the action or claim, file or
refile a claim for actual damages occurring before January 1, 2002,
that were proximately caused by a time lapse between loan
satisfaction and the completion of the beneficiary's obligations as
required under paragraph (1) of subdivision (b).  In any action
brought under this section, the defendant may be found liable for
actual damages, but may not be found liable for any civil penalty
authorized by Section 2941.
   (j) Notwithstanding any other penalties, if a beneficiary collects
a fee for reconveyance and thereafter has knowledge, or should have
knowledge, that no reconveyance has been recorded, the beneficiary
shall cause to be recorded the reconveyance, or in the event a
release of obligation is earlier and timely recorded, the beneficiary
shall refund to the trustor the fee charged to perform the
reconveyance.  Evidence of knowledge includes, but is not limited to,
notice of a release of obligation pursuant to paragraph (3) of
subdivision (b).



2941.1.  Notwithstanding any other provision of law, if no payoff
demand statement is issued pursuant to Section 2943, nothing in
Section 2941 shall be construed to prohibit the charging of a
reconveyance fee.


2941.5.  Every person who willfully violates Section 2941 is guilty
of a misdemeanor punishable by fine of not less than fifty dollars
($50) nor more than four hundred dollars ($400), or by imprisonment
in the county jail for not to exceed six months, or by both such fine
and imprisonment.
   For purposes of this section, "willfully" means simply a purpose
or willingness to commit the act, or make the omission referred to.
It does not require an intent to violate the law, to injure another,
or to acquire any advantage.



2941.7.  Whenever the obligation secured by a mortgage or deed of
trust has been fully satisfied and the present mortgagee or
beneficiary of record cannot be located after diligent search, or
refuses to execute and deliver a proper certificate of discharge or
request for reconveyance, or whenever a specified balance, including
principal and interest, remains due and the mortgagor or trustor or
the mortgagor's or trustor's successor in interest cannot, after
diligent search, locate the then mortgagee or beneficiary of record,
the lien of any mortgage or deed of trust shall be released when the
mortgagor or trustor or the mortgagor's or trustor's successor in
interest records or causes to be recorded, in the office of the
county recorder of the county in which the encumbered property is
located, a corporate bond accompanied by a declaration, as specified
in subdivision (b), and with respect to a deed of trust, a
reconveyance as hereinafter provided.
   (a) The bond shall be acceptable to the trustee and shall be
issued by a corporation lawfully authorized to issue surety bonds in
the State of California in a sum equal to the greater of either (1)
two times the amount of the original obligation secured by the
mortgage or deed of trust and any additional principal amounts,
including advances, shown in any recorded amendment thereto, or (2)
one-half of the total amount computed pursuant to (1) and any accrued
interest on such amount, and shall be conditioned for payment of any
sum which the mortgagee or beneficiary may recover in an action on
the obligation secured by the mortgage or deed of trust, with costs
of suit and reasonable attorneys' fees.  The obligees under the bond
shall be the mortgagee or mortgagee's successor in interest or the
trustee who executes a reconveyance under this section and the
beneficiary or beneficiary's successor in interest.
   The bond recorded by the mortgagor or trustor or mortgagor's or
trustor's successor in interest shall contain the following
information describing the mortgage or deed of trust:
   (1) Recording date and instrument number or book and page number
of the recorded instrument.
   (2) Names of original mortgagor and mortgagee or trustor and
beneficiary.
   (3) Amount shown as original principal sum secured thereby.
   (4) The recording information and new principal amount shown in
any recorded amendment thereto.
   (b) The declaration accompanying the corporate bond recorded by
the mortgagor or trustor or the mortgagor's or trustor's successor in
interest shall state:
   (1) That it is recorded pursuant to this section.
   (2) The name of the original mortgagor or trustor and mortgagee or
beneficiary.
   (3) The name and address of the person making the declaration.
   (4) That either the obligation secured by the mortgage or deed of
trust has been fully satisfied and the present mortgagee or
beneficiary of record cannot be located after diligent search, or
refuses to execute and deliver a proper certificate of discharge or
request for reconveyance as required under Section 2941; or that a
specified balance, including principal and interest, remains due and
the mortgagor or trustor or mortgagor's or trustor's successor in
interest cannot, after diligent search, locate the then mortgagee or
beneficiary.
   (5) That the declarant has mailed by certified mail, return
receipt requested, to the last address of the person to whom payments
under the mortgage or deed of trust were made and to the last
mortgagee or beneficiary of record at the address for such mortgagee
or beneficiary shown on the instrument creating, assigning, or
conveying the interest, a notice of recording a declaration and bond
under this section and informing the recipient of the name and
address of the mortgagor or trustee, if any, and of the right to
record a written objection with respect to the release of the lien of
the mortgage or, with respect to a deed of trust, notify the trustee
in writing of any objection to the reconveyance of the deed of
trust.  The declaration shall state the date any notices were mailed
pursuant to this section and the names and addresses of all persons
to whom mailed.
   The declaration provided for in this section shall be signed by
the mortgagor or trustor under penalty of perjury.
   (c) With respect to a deed of trust, after the expiration of 30
days following the recording of the corporate bond and accompanying
declaration provided in subdivisions (a) and (b), and delivery to the
trustee of the usual reconveyance fees plus costs and a demand for
reconveyance under this section, the trustee shall execute and
record, or otherwise deliver as provided in Section 2941, a
reconveyance in the same form as if the beneficiary had delivered to
the trustee a proper request for reconveyance, provided that the
trustee has not received a written objection to the reconveyance from
the beneficiary of record.  No trustee shall have any liability to
any person by reason of its execution of a reconveyance in reliance
upon a trustor's or trustor's successor's in interest substantial
compliance with this section.  The sole remedy of any person damaged
by reason of the reconveyance shall be against the trustor, the
affiant, or the bond.  With respect to a mortgage, a mortgage shall
be satisfied of record when 30 days have expired following
recordation of the corporate bond and accompanying declaration,
provided no objection to satisfaction has been recorded by the
mortgagee within that period.  A bona fide purchaser or encumbrancer
for value shall take the interest conveyed free of such mortgage,
provided there has been compliance with subdivisions (a) and (b) and
the deed to the purchaser recites that no objections by the mortgagee
have been recorded.
   Upon recording of a reconveyance under this section, or, in the
case of a mortgage the expiration of 30 days following recordation of
the corporate bond and accompanying declaration without objection
thereto having been recorded, interest shall no longer accrue as to
any balance remaining due to the extent the balance due has been
alleged in the declaration recorded under subdivision (b).
   The sum of any specified balance, including principal and
interest, which remains due and which is remitted to any issuer of a
corporate bond in conjunction with the issuance of a bond pursuant to
this section shall, if unclaimed, escheat to the state after three
years pursuant to the Unclaimed Property Law.  From the date of
escheat the issuer of the bond shall be relieved of any liability to
pay to the beneficiary or his or her heirs or other successors in
interest the escheated funds and the sole remedy shall be a claim for
property paid or delivered to the Controller pursuant to the
Unclaimed Property Law.
   (d) The term "diligent search," as used in this section, shall
mean all of the following:
   (1) The mailing of notices as provided in paragraph (5) of
subdivision (b), and to any other address that the declarant has used
to correspond with or contact the mortgagee or beneficiary.
   (2) A check of the telephone directory in the city where the
mortgagee or beneficiary maintained the mortgagee's or beneficiary's
last known address or place of business.
   (3) In the event the mortgagee or beneficiary or the mortgagee's
or beneficiary's successor in interest is a corporation, a check of
the records of the California Secretary of State and the secretary of
state in the state of incorporation, if known.
   (4) In the event the mortgagee or beneficiary is a state or
national bank or a state or federal savings and loan association, an
inquiry of the regulatory authority of such bank or savings and loan
association.
   (e) This section shall not be deemed to create an exclusive
procedure for the issuance of reconveyances and the issuance of bonds
and declarations to release the lien of a mortgage and shall not
affect any other procedures, whether or not such procedures are set
forth in statute, for the issuance of reconveyances and the issuance
of bonds and declarations to release the lien of a mortgage.
   (f) For purposes of this section, the trustor or trustor's
successor in interest may substitute the present trustee of record
without conferring any duties upon the trustee other than those that
are incidental to the execution of a reconveyance pursuant to this
section if all of the following requirements are met:
   (1) The present trustee of record and the present mortgagee or
beneficiary of record cannot be located after diligent search.
   (2) The declaration filed pursuant to subdivision (b) shall state
in addition that it is filed pursuant to this subdivision, and shall,
in lieu of the provisions of paragraph (4) of subdivision (b), state
that the obligation secured by the mortgage or deed of trust has
been fully satisfied and the present trustee of record and present
mortgagee or beneficiary of record cannot be located after diligent
search.
   (3) The substitute trustee is a title insurance company that
agrees to accept the substitution.  This subdivision shall not impose
a duty upon a title insurance company to accept the substitution.
   (4) The corporate bond required in subdivision (a) is for a period
of five or more years.



2941.9.  (a) The purpose of this section is to establish a process
through which all of the beneficiaries under a trust deed may agree
to be governed by beneficiaries holding more than 50 percent of the
record beneficial interest of a series of notes secured by the same
real property or of undivided interests in a note secured by real
property equivalent to a series transaction, exclusive of any notes
or interests of a licensed real estate broker that is the issuer or
servicer of the notes or interests or any affiliate of that licensed
real estate broker.
   (b) All holders of notes secured by the same real property or a
series of undivided interests in notes secured by real property
equivalent to a series transaction may agree in writing to be
governed by the desires of the holders of more than 50 percent of the
record beneficial interest of those notes or interests, exclusive of
any notes or interests of a licensed real estate broker that is the
issuer or servicer of the notes or interests of any affiliate of the
licensed real estate broker, with respect to actions to be taken on
behalf of all holders in the event of default or foreclosure for
matters that require direction or approval of the holders, including
designation of the broker, servicing agent, or other person acting on
their behalf, and the sale, encumbrance, or lease of real property
owned by the holders resulting from foreclosure or receipt of a deed
in lieu of foreclosure.
   (c) A description of the agreement authorized in subdivision (b)
of this section shall be disclosed pursuant to Section 10232.5 of the
Business and Professions Code and shall be included in a recorded
document such as the deed of trust or the assignment of interests.
   (d) Any action taken pursuant to the authority granted in this
section is not effective unless all the parties agreeing to the
action sign, under penalty of perjury, a separate written document
entitled "Majority Action Affidavit" stating the following:
   (1) The action has been authorized pursuant to this section.
   (2) None of the undersigned is a licensed real estate broker or an
affiliate of the broker that is the issuer or servicer of the
obligation secured by the deed of trust.
   (3) The undersigned together hold more than 50 percent of the
record beneficial interest of a series of notes secured by the same
real property or of undivided interests in a note secured by real
property equivalent to a series transaction.
   (4) Notice of the action was sent by certified mail, postage
prepaid, with return receipt requested, to each holder of an interest
in the obligation secured by the deed of trust who has not joined in
the execution of the substitution or this document.
   This document shall be recorded in the office of the county
recorder of each county in which the real property described in the
deed of trust is located.  Once the document in this subdivision is
recorded, it shall constitute conclusive evidence of compliance with
the requirements of this subdivision in favor of trustees acting
pursuant to this section, substituted trustees acting pursuant to
Section 2934a, subsequent assignees of the obligation secured by the
deed of trust, and subsequent bona fide purchasers or encumbrancers
for value of the real property described therein.
   (e) For purposes of this section, "affiliate of the licensed real
estate broker" includes any person as defined in Section 25013 of the
Corporations Code who is controlled by, or is under common control
with, or who controls, a licensed real estate broker.  "Control"
means the possession, direct or indirect, of the power to direct or
cause the direction of management and policies.



2942.  Contracts of bottomry or respondentia, although in the nature
of mortgages, are not affected by any of the provisions of this
Chapter.


2943.  (a) As used in this section:
   (1) "Beneficiary" means a mortgagee or beneficiary of a mortgage
or deed of trust, or his or her assignees.
   (2) "Beneficiary statement" means a written statement showing:
   (A) The amount of the unpaid balance of the obligation secured by
the mortgage or deed of trust and the interest rate, together with
the total amounts, if any, of all overdue installments of either
principal or interest, or both.
   (B) The amounts of periodic payments, if any.
   (C) The date on which the obligation is due in whole or in part.
   (D) The date to which real estate taxes and special assessments
have been paid to the extent the information is known to the
beneficiary.
   (E) The amount of hazard insurance in effect and the term and
premium of that insurance to the extent the information is known to
the beneficiary.
   (F) The amount in an account, if any, maintained for the
accumulation of funds with which to pay taxes and insurance premiums.

   (G) The nature and, if known, the amount of any additional
charges, costs, or expenses paid or incurred by the beneficiary which
have become a lien on the real property involved.
   (H) Whether the obligation secured by the mortgage or deed of
trust can or may be transferred to a new borrower.
   (3) "Delivery" means depositing or causing to be deposited in the
United States mail an envelope with postage prepaid, containing a
copy of the document to be delivered, addressed to the person whose
name and address is set forth in the demand therefor.  The document
may also be transmitted by facsimile machine to the person whose name
and address is set forth in the demand therefor.
   (4) "Entitled person" means the trustor or mortgagor of, or his or
her successor in interest in, the mortgaged or trust property or any
part thereof, any beneficiary under a deed of trust, any person
having a subordinate lien or encumbrance of record thereon, the
escrowholder licensed as an agent pursuant to Division 6 (commencing
with Section 17000) of the Financial Code, or the party exempt by
virtue of Section 17006 of the Financial Code who is acting as the
escrowholder.
   (5) "Payoff demand statement" means a written statement, prepared
in response to a written demand made by an entitled person or
authorized agent, setting forth the amounts required as of the date
of preparation by the beneficiary, to fully satisfy all obligations
secured by the loan that is the subject of the payoff demand
statement.  The written statement shall include information
reasonably necessary to calculate the payoff amount on a per diem
basis for the period of time, not to exceed 30 days, during which the
per diem amount is not changed by the terms of the note.
   (b) (1) A beneficiary, or his or her authorized agent, shall,
within 21 days of the receipt of a written demand by an entitled
person or his or her authorized agent, prepare and deliver to the
person demanding it a true, correct, and complete copy of the note or
other evidence of indebtedness with any modification thereto, and a
beneficiary statement.
   (2) A request pursuant to this subdivision may be made by an
entitled person or his or her authorized agent at any time before, or
within two months after, the recording of a notice of default under
a mortgage or deed of trust, or may otherwise be made more than 30
days prior to the entry of the decree of foreclosure.
   (c) A beneficiary, or his or her authorized agent, shall, on the
written demand of an entitled person, or his or her authorized agent,
prepare and deliver a payoff demand statement to the person
demanding it within 21 days of the receipt of the demand.  However,
if the loan is subject to a recorded notice of default or a filed
complaint commencing a judicial foreclosure, the beneficiary shall
have no obligation to prepare and deliver this statement as
prescribed unless the written demand is received prior to the first
publication of a notice of sale or the notice of the first date of
sale established by a court.
   (d) (1) A beneficiary statement or payoff demand statement may be
relied upon by the entitled person or his or her authorized agent in
accordance with its terms, including with respect to the payoff
demand statement reliance for the purpose of establishing the amount
necessary to pay the obligation in full.  If the beneficiary notifies
the entitled person or his or her authorized agent of any amendment
to the statement, then the amended statement may be relied upon by
the entitled person or his or her authorized agent as provided in
this subdivision.
   (2) If notification of any amendment to the statement is not given
in writing, then a written amendment to the statement shall be
delivered to the entitled person or his or her authorized agent no
later than the next business day after notification.
   (3) Upon the dates specified in subparagraphs (A) and (B) any sums
that were due and for any reason not included in the statement or
amended statement shall continue to be recoverable by the beneficiary
as an unsecured obligation of the obligor pursuant to the terms of
the note and existing provisions of law.
   (A) If the transaction is voluntary, the entitled party or his or
her authorized agent may rely upon the statement or amended statement
upon the earlier of (i) the close of escrow, (ii) transfer of title,
or (iii) recordation of a lien.
   (B) If the loan is subject to a recorded notice of default or a
filed complaint commencing a judicial foreclosure, the entitled party
or his or her authorized agent may rely upon the statement or
amended statement upon the acceptance of the last and highest bid at
a trustee's sale or a court supervised sale.
   (e) The following provisions apply to a demand for either a
beneficiary statement or a payoff demand statement:
   (1) If an entitled person or his or her authorized agent requests
a statement pursuant to this section and does not specify a
beneficiary statement or a payoff demand statement the beneficiary
shall treat the request as a request for a payoff demand statement.
   (2) If the entitled person or the entitled person's authorized
agent includes in the written demand a specific request for a copy of
the deed of trust or mortgage, it shall be furnished with the
written statement at no additional charge.
   (3) The beneficiary may, before delivering a statement, require
reasonable proof that the person making the demand is, in fact, an
entitled person or an authorized agent of an entitled person, in
which event the beneficiary shall not be subject to the penalties of
this section until 21 days after receipt of the proof herein provided
for.  A statement in writing signed by the entitled person
appointing an authorized agent when delivered personally to the
beneficiary or delivered by registered return receipt mail shall
constitute reasonable proof as to the identity of an agent.  Similar
delivery of a policy of title insurance, preliminary report issued by
a title company, original or photographic copy of a grant deed or
certified copy of letters testamentary, guardianship, or
conservatorship shall constitute reasonable proof as to the identity
of a successor in interest, provided the person demanding a statement
is named as successor in interest in the document.
   (4) If a beneficiary for a period of 21 days after receipt of the
written demand willfully fails to prepare and deliver the statement,
he or she is liable to the entitled person for all damages which he
or she may sustain by reason of the refusal and, whether or not
actual damages are sustained, he or she shall forfeit to the entitled
person the sum of three hundred dollars ($300).  Each failure to
prepare and deliver the statement, occurring at a time when, pursuant
to this section, the beneficiary is required to prepare and deliver
the statement, creates a separate cause of action, but a judgment
awarding an entitled person a forfeiture, or damages and forfeiture,
for any failure to prepare and deliver a statement bars recovery of
damages and forfeiture for any other failure to prepare and deliver a
statement, with respect to the same obligation, in compliance with a
demand therefor made within six months before or after the demand as
to which the award was made.  For the purposes of this subdivision,
"willfully" means an intentional failure to comply with the
requirements of this section without just cause or excuse.
   (5) If the beneficiary has more than one branch, office, or other
place of business, then the demand shall be made to the branch or
office address set forth in the payment billing notice or payment
book, and the statement, unless it specifies otherwise, shall be
deemed to apply only to the unpaid balance of the single obligation
named in the request and secured by the mortgage or deed of trust
which is payable at the branch or office whose address appears on the
aforesaid billing notice or payment book.
   (6) The beneficiary may make a charge not to exceed thirty dollars
($30) for furnishing each required statement.  The provisions of
this paragraph shall not apply to mortgages or deeds of trust insured
by the Federal Housing Administrator or guaranteed by the
Administrator of Veterans Affairs.
   (f) The preparation and delivery of a beneficiary statement or a
payoff demand statement pursuant to this section shall not change a
date of sale established pursuant to Section 2924g.



2944.  None of the provisions of this chapter applies to any
transaction or security interest governed by the Commercial Code,
except to the extent made applicable by reason of an election made by
the secured party pursuant to subparagraph (B) of paragraph (1) of
subdivision (a) of Section 9604 of the Commercial Code.




2944.5.  No lender, mortgagee, or any third party having an interest
in real or personal property shall refuse to accept a policy issued
by an admitted insurer solely  because the policy is issued for a
continuous period without a fixed expiration date even though the
policy premium is due and payable every six months, provided the
lender, mortgagee, or third party is entitled to receive (a) notice
of renewal from the insurer within 15 days of receipt of payment on
the policy by the insured or (b) notice of cancellation or nonrenewal
under the terms and conditions set forth in Sections 678 and 2074.8
of the Insurance Code, whichever is applicable.