A rescission of notice of default in California is a recorded document that cancels a notice of default the trustee filed earlier. Once it is recorded, that particular foreclosure stops, and any sale based on that notice cannot go forward. It is often good news, but it does not always mean the loan problem is over.
If you received a rescission and are unsure what it means for your home, call (415) 754-0115 to schedule your free consultation, or send a copy through our contact page.
Where the rescission fits in the foreclosure process
California foreclosures on deeds of trust usually run outside of court. The trustee records a notice of default with the county recorder, waits at least three months, records a notice of trustee sale, and then holds the auction. Our guide to what a notice of default is explains that first step in detail.
A notice of rescission is the formal way to undo that first step. It is recorded in the same county records, often titled "Notice of Rescission of Declaration of Default and Demand for Sale and of Notice of Breach and Election to Cause Sale." The wording is long, but the effect is simple: the earlier notice is withdrawn.
Why lenders record a rescission of notice of default in California
The reason matters, because it shapes what happens next.
The borrower reinstated the loan
California law generally lets a borrower cure the default by paying the past-due amounts, plus allowed costs and fees, up until five business days before the scheduled sale. When that happens, the trustee rescinds the notice of default and the loan continues on its original terms. See our article on mortgage reinstatement in California for how that works.
A loan modification was completed
When a servicer approves a permanent modification, the past-due balance is usually folded into the new terms, and the foreclosure is rescinded because the default no longer exists in the same form.
The notice was defective
Sometimes a notice of default was recorded with errors, sent to the wrong address, or recorded without following required pre-foreclosure steps, such as contacting the borrower to discuss options. A servicer may rescind to fix the problem rather than defend it.
Rescind and restart
In that situation, a new notice of default may be recorded later. When it is, the minimum three-month waiting period generally starts over from the new recording date, which can give the homeowner more time but also means the foreclosure is not truly finished.
The servicer or loan owner changed
Transfers of servicing or of the loan itself sometimes lead to a rescission while the new company sets up the file and reviews loss mitigation.
What a rescission does and does not erase
It helps to be clear about the limits.
- It does cancel the pending foreclosure started by that notice of default, including any notice of trustee sale tied to it.
- It does not remove the record. Both the original notice and the rescission remain in the county's public records.
- It does not erase credit reporting of payments that were late or missed before the cure or modification.
- It does not forgive the debt unless a separate agreement says so.
- It does not prevent a future foreclosure if a new default occurs or if the original default was never actually resolved.
Questions to ask when you see a rescission
Because the reason drives the outcome, homeowners often want answers to a few practical questions:
- Was the default cured, or is the servicer still claiming money is owed?
- If a modification was approved, are the new terms in a signed agreement?
- Is the servicer planning to record a new notice of default, and if so, when?
- Do the account statements after the rescission match what you were told?
If the answers are unclear, written requests to the servicer can help. Federal rules allow borrowers to send a request for information or a notice of error, and the servicer must respond within set time frames. Keep copies of every request and response, along with the recorded documents themselves, because together they create the clearest picture of where the loan stands and whether the servicer's statements are consistent.
How an attorney can help after a rescission
A rescission is often a turning point. For some homeowners it means the crisis is over. For others it is a pause before a second notice of default, and that pause is valuable time to prepare a loan modification application, review the servicer's conduct under the Homeowner Bill of Rights, or compare options such as a short sale or Chapter 13.
The Somal Law Firm handles foreclosure defense, loan modification, and mortgage disputes for homeowners in Pleasanton, Dublin, Livermore, San Ramon, Danville, and throughout Alameda and Contra Costa Counties. Attorney Bob Somal can read the recorded documents with you, compare them with your loan history, and explain what the rescission means in your specific situation.
Frequently asked questions
Does a rescission of notice of default mean my foreclosure is over?
It means that specific foreclosure is canceled. Whether the overall problem is resolved depends on why it was rescinded and whether the default was cured or replaced by new loan terms.
Can the lender file a new notice of default after rescinding?
Yes, if there is still a default or a new one occurs. A new notice generally restarts the waiting period before a sale can be scheduled.
Will the rescission show up on my credit report?
The rescission is a public record, but credit reports are driven mainly by payment history. Late payments reported before the cure typically remain.
How do I get a copy of the rescission?
It is recorded with the county recorder where the property sits, such as Alameda or Contra Costa County. The trustee or servicer may also mail a copy.
When you reach out, we will review the notice of default, the rescission, and your servicer correspondence, and explain what could happen next and which options fit. Call (415) 754-0115 to schedule your free consultation, or use our contact page to send your documents.
Attorney Advertising. This article is general legal information for Bay Area residents, not legal advice, and does not create an attorney–client relationship. Every situation is different — please consult a licensed attorney about your specific circumstances.