Legal Question in Real Estate Law in California
If a person filed Chapter 7, received discharge and has upside down real estate that a lender wont take back via foreclosure or deed in lieu. Can they just record a deed granting title back to the bank to force the transfer?
I am curious if anyone knows if this is possible in California, as found an article at written by a Texas attorney who has done this type of title change. Article for reference is at: http://www.lonestarlandlaw.com/Deeding-Property.html
2 Answers from Attorneys
In California delivery of a deed must be accepted in order for it to be a valid transfer of title. I'm not sure why, however, anyone would want to give property back to the bank that they don't have to pay for anymore.
Although delivery must be accepted, there is a rebuttable presumption of acceptance. Therefore, a trust deed beneficiary probably needs to take an affirmative step to reject the attempt to deed property to it. The process of recording a nonacceptance is covered in Civil Code section 1058.5.
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