Skip to content

CAN YOU FORCE A SALE OF REAL PROPERTY?

One of the first steps you take after obtaining a judgment is to record an abstract of judgment in each county your judgment debtor owns property. Recording an abstract establishes a lien on the property and prevents your judgment debtor from selling or refinancing their property without your consent.

In many instances once you’ve taken this step you can sit back and let the judgment accrue interest at 10% per year and wait until the judgment debtor attempts to sell or refinance property. Sometimes a more aggressive approach is warranted to force the sale of the asset. The best tool to do this is to levy the property with a writ of execution to initiate a sheriff’s sale. A sheriff’s sale is an expensive and time consuming process but if done correctly under the proper circumstances, it is a powerful tool. This post details the steps you should take to determine whether a real estate levy is a viable option for your case.

The property pictured in the header of this post is a 4 bedroom 3.5 bath home of over 6,000 square foot on .97 acres in Pleasanton (East Bay) California. It was sold by Alameda (Oakland) Sheriff’s Department on an execution sale directed by my office. It sold for over 2.5 million dollars.

A real property levy can only be used when the judgment debtor has equity in the property over the liens senior to your position on the property. Put simply: if the property is sold, all lienholders ahead of you have to be paid in full before any money can go towards the satisfaction of your judgment. You will not be able to obtain an order from the court to allow the sheriff to conduct the sale if the sale would not produce any funds to satisfy your judgment.   The first step is to determine if you would get any money from the sale of the property is to determine what liens have a higher priority than you.   To do this you should conduct a public records search to see what, if any liens are on the property recorded prior in time to the abstract of judgment you have recorded in the county where the property is located.  

When you have determined which liens are ahead of you the next step is to determine the balance of each lien.   If you have recorded an abstract on the property, Civil Code 2943(a)(5) allows you to send a letter to any senior lienholder to obtain a payoff statement of their lien within 21 days of the letter.  After you have determined the balance of the senior liens you need to determine whether a disabled veteran exemption or homestead exemption applies.  A homestead exemption is either recorded or can be claimed, if the exemption is claimed the burden of proof is on party claiming it but you must make your own decision prior to taking the next steps on whether you believe the exemption applies.  Additionally, the amount of homestead exemption differs in family circumstances and when you first obtained your lien on the property.  If the lien is first recorded prior to 2021 the amount is significantly smaller.   Next, you need a rough estimate of the Fair Market Value of the home.  Using all the information you have obtained you should have an idea of whether there is equity or not in the property and whether you want to proceed with the next very expensive steps.  If there is a homestead exemption present on the property, the sale price of the home can be no lower than 90% of the fair market value.

If you have determined there is equity in the property you are now ready to proceed with steps necessary to levy the property and obtain an order for sale from the court.   Part II of this post will detail the levy process and obtaining the order for sale.