Can you use cashiers checks from another state for CA foreclosure auctions.


#1

I am planning to bid on foreclosures in CA with funds coming from investors in another state. Can I use cashiers checks from another state to bid at foreclore auctions in California?


#2

The answer is yes. This from CC 2924(h)(b) –
(b) At the trustee’s sale the trustee shall have the right (1) to
require every bidder to show evidence of the bidder’s ability to
deposit with the trustee the full amount of his or her final bid in
cash, a cashier’s check drawn on a state or national bank, a check
drawn by a state or federal credit union, or a check drawn by a state
or federal savings and loan association, savings association, or
savings bank specified in Section 5102 of the Financial Code and
authorized to do business in this state, or a cash equivalent which
has been designated in the notice of sale as acceptable to the
trustee prior to, and as a condition to, the recognizing of the bid,
and to conditionally accept and hold these amounts for the duration
of the sale, and (2) to require the last and highest bidder to
deposit, if not deposited previously, the full amount of the bidder’s
final bid in cash, a cashier’s check drawn on a state or national
bank, a check drawn by a state or federal credit union, or a check
drawn by a state or federal savings and loan association, savings
association, or savings bank specified in Section 5102 of the
Financial Code and authorized to do business in this state, or a cash
equivalent which has been designated in the notice of sale as
acceptable to the trustee, immediately prior to the completion of the
sale, the completion of the sale being so announced by the fall of


#3

I have seen several auctioneers announce that they will not accept cashier’s checks drawn on an out of state bank, even though the Civil Code shown above is the law.

I think they use the portion of the Civil Code above that says … “authorized to do business in this state”. I honestly do not know how they get their authority to refuse out of state checks, but they do.


#4

Of course w. 90%+ of the business done by mega banks, that shouldn’t be a problem. WF, BofA, Citi, Chase etc. are all doing business directly in the state. A few decades ago, some Trustees tried to use every excuse not to take certain checks. Some wouldn’t even take “Certified Checks” from "authorized banks even though Certified Checks are even “stronger” than cashier’s checks. Certified Checks are rarely used, now.
There is an old case that addressed an obstinate Trustee on this issue - Baron v. Colonial (1980) 111 Cal. App. 3d 316. (Note the atty who filed an amicus brief.)
The man who headed Home S&L’s fcl. dept. (they were then the largest S&L) announced at a meeting he wouldn’t accept a check drawn on his own S&L because the code at that time mentioned only cashier’s checks drawn on “banks”.