Joyce D. Crist v. JG Wentworth Home Lending, LLC, et al.

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF SAN BERNARDINO

JOYCE D. CRIST, Case No.: CIVSB2502787 Plaintiff, [TENTATIVE] ORDER DENYING MOTION FOR PRELIMINARY v. INJUNCTION FILED BY PLAINTIFF JOYCE D. CRIST JG WENTWORTH HOME LENDING, LLC, et al., Defendants.

VIII. INTRODUCTION

A. The Pleadings and Allegations

Through her operative first amended complaint (FAC), which is the product of a prior

unopposed demurrer, Plaintiff Joyce D. Crist contends that she had a $215,000 loan secured

against her property in Big Bear City. The loan was with Defendant JG Wentworth Home

Lending, LLC, which is now Defendant Van Buren Mortgage, LLC (Van Buren), which in turn

was acquired by Defendant Freedom Mortgage Corp (Freedom). While the loan required Crist to

obtain insurance, she had the option to do so personally and, as a result, there was no escrow.

Although the insurance later lapsed and while Freedom purchased and imposed the insurance

through an escrow, Crist contends she later obtained her own insurance and closed the escrow

account, but there were unapplied funds in the escrow. Freedom nevertheless purportedly

continued to make the insurance payments and applied the escrow funds to the payment, creating

a false impression that the loan was in default. Despite demands that Freedom correct the issue, it

did not do so and began charging Crist late fees and then pursued foreclosure. (FAC at ¶¶ 1, 2, 4,

8, and 12-17.)

The FAC also outlines Crist’s efforts to obtain a loan modification and indicates she was

in active loan modification discussions and 30 days had not lapsed since Freedom sent a denial

letter when Defendant Nester Solutions, LLC (Nester) conducted the foreclosure. (FAC at ¶¶ 19-

33.) Furthermore, the foreclosure sale price was allegedly below 67% of the market value for the

property and Nester received several notices of intent to bid on the property after the foreclosure.

Overall, the FAC contains claims for (1) breach of contract, (2) breach of the implied covenant,

(3) intentional misrepresentation, (4) negligent misrepresentation, (5) negligence, (6) violation of

Civil Code section 2923.6, (7) violation of Civil Code section 2924f, (8) violation of 12 C.F.R.

section 1024, et seq., and (9) declaratory relief.

B. The Requested TRO and Preliminary Injunction

On April 16, 2026, the Court granted Crist’s ex parte application for a TRO to prevent

the transfer of the property (since the sale is not yet complete). Crist then filed the pending

motion for a preliminary injunction on April 28, again seeking an order prohibiting the transfer

of the property on the grounds that the foreclosure was invalid, the sale violated the Homeowner

Bill of Rights (HBOR), and in the absence of an injunction Crist will suffer irreparable harm.

The motion also includes a fee request.

The motion is supported by a declaration from attorney Cameron Young, a declaration

from Crist, the note and deed of trust, the notice of default and election to sell, the notice of

trustee’s sale, an appraisal report for the property, a loan modification application, a receipt for

the application, subsequent correspondence, screen shots from Crist’s online account, and the

$10,000 bond posted by Crist.

Van Buren and Freedom opposed the motion on the grounds that Crist is asserting new

claims in the motion, she has not demonstrated a reasonable probability of prevailing on her

claims, Crist failed to join an indispensable party, the balance of equities does not favor Crist,

and the fee request is premature. The opposition is supported by a declaration from Tanya Tarver

(Freedom’s VP of litigation), the note, the deed of trust, annual escrow statements, and

correspondence and offers exchanged.

Crist has replied and submits her own supplemental declaration, insurance payments, a

letter from Freedom showing the cancellation of the insurance it had obtained for Crist, an e-mail

from the insurer (California Fair Plan) confirming the refund, and another declaration from

Young.

After issuing a tentative ruling and holding a hearing on the motion, the Court now issues

its final ruling.3

IX. APPLICABLE LAW An injunction is proper when it appears the plaintiff is entitled to the relief demanded and

that relief includes an injunction. (Code Civ. Proc., § 526, subd. (a)(1).) Code of Civil Procedure

section 526, subdivision (a)(3), also allows for an injunction “[w]hen it appears, during the

litigation, that a party to the action is doing, or threatens, or is about to do, or is procuring or

3 The Court finds that the moving party has complied with its meet-and-confer obligation.

suffering to be done, some act in violation of the rights of another party to the action respecting

the subject of the action, and tending to render the judgment ineffectual.”

In deciding whether to issue a preliminary injunction the court must evaluate and balance

two factors. Namely, the plaintiff’s likelihood of prevailing on the merits and the interim harm

that would result. (White v. Davis (2002) 98 Cal.App.4th 969, 981.) The greater the showing on

one factor, the less that must be shown on the other. (Butt v. State of Calif. (1992) 4 Cal.4th 668,

678.) “The purpose of a preliminary injunction ‘is to preserve the status quo until a final

determination following a trial.’ [Citation.] It ‘does not constitute a final adjudication of the

controversy.’” (Ibid.) “The law is well settled that the decision to grant a preliminary injunction

rests in the sound discretion of the trial court.” (IT Corp. v. County of Imperial (1983) 35 Cal.3d

63, 69.)

To establish a likelihood of prevailing on the merits, the moving party must present

competent evidence to show a reasonable probability of succeeding on the merits. (San

Francisco Newspaper Printing Co. v. Sup. Ct. (1985) 170 Cal.App.3d 438.) Supporting

affidavits and declarations must state evidentiary facts. The burden is on the party seeking

injunctive relief to show all elements necessary to support issuance of a preliminary injunction.

(O’Connell v. Superior Court (2006) 141 Cal.App.4th 1452, 1481.)

X. EXPLANATION OF COURT’S RULING A. The Likelihood of Success Prong

1. The Civil Code section 2923.6 Claim Civil Code section 2923.6, subdivision (c), provides that:

If a borrower submits a complete application for a first lien loan modification offered by, or through, the borrower’s mortgage servicer at least five business days before a scheduled foreclosure sale, a mortgage servicer, mortgagee, trustee, beneficiary, or authorized agent shall not record a notice of default or notice of sale, or conduct a trustee’s sale, while the complete first lien loan modification application is pending. A mortgage servicer, mortgagee, trustee, beneficiary, or

authorized agent shall not record a notice of default or notice of sale or conduct a trustee’s sale until any of the following occurs: (1) The mortgage servicer makes a written determination that the borrower is not eligible for a first lien loan modification, and any appeal period pursuant to subdivision (d) has expired. (2) The borrower does not accept an offered first lien loan modification within 14 days of the offer. (3) The borrower accepts a written first lien loan modification, but defaults on, or otherwise breaches the borrower’s obligations under, the first lien loan modification.

Subdivision (d) of section 2923.6 then indicates that if the borrower’s application for a

first lien loan modification is denied, the borrower shall have at least 30 days from the date of the

written denial to appeal the denial and provide evidence that the decision was in error. However,

in “order to minimize the risk of borrowers submitting multiple applications for first lien loan

modifications for the purpose of delay, the mortgage servicer shall not be obligated to evaluate

applications from borrowers who have been evaluated or afforded a fair opportunity to be

evaluated consistent with the requirements of this section, unless there has been a material

change in the borrower’s financial circumstances since the date of the borrower’s previous

application and that change is documented by the borrower and submitted to the mortgage

servicer.” (Civ. Code, § 2923.6, subd. (g).) An application is “deemed “complete” when a

borrower has supplied the mortgage servicer with all documents required by the mortgage

servicer within the reasonable timeframes specified by the mortgage servicer.” (Civ. Code,

§ 2923.6, subd. (h).) Civil Code section 2924.12 also provides that when a trustee’s deed upon

sale has not been recorded, “a borrower may bring an action for injunctive relief to enjoin a

material violation of Section ... 2923.6....”

In this case, Crist contends her loan modification application was denied on February 4,

2026, via letter of the same date. While Crist concedes that a previous trial modification was

provided, she argues it does not constitute a modification for purposes of section 2923.6 because

the related correspondence makes clear that she was only afforded a trial modification, that if

there was compliance during the trial period a separate loan modification agreement would be

required, and that the unpaid late charges would not be waived until the formal modification. The

foreclosure occurred on March 3, 2026, 27 days later. (Crist Decl. at ¶¶ 30-32; Ex.’s Q, R, S, and

T.)

However, Crist provides no authority for the proposition a temporary period plan (TPP)

cannot constitute an offer for a first lien modification. In the opposition, Defendants cite Bushell

v. JPMorgan Chase Bank, N.A. (2013) 220 Cal.App.4th 915, 926, for the proposition that a TPP

letter constitutes a loan modification offer for purposes of HBOR, but that case did not involve

HBOR or section 2923.6. Instead, the lawsuit involved the Home Affordable Mortgage Program

or HAMP. Nevertheless, the case addressed TPP’s in the context of a breach of contract cause of

action and determined that a TPP constitutes a contract and that when the plaintiff has alleged

compliance with all of the TPP terms, a valid claim for breach of contract exists when the lender

fails to offer a permanent loan modification.

Here, the December 9, 2025 letter from Freedom to Crist expressly denied her certain

foreclosure alternatives and indicated she had a right to appeal within 30 days. The letter then

indicates Crist was eligible for a “FHLMC Flex Modification.” The letter also clearly states that

the document constitutes a TPP, an offer, and that if Crist completed the TPP by making the

payments then Freedom would sign the loan modification agreement for a permanent

modification. The letter further outlines the modification terms. (Crist Decl., Ex. Q.) Under the

contract principles addressed in Bushell, the letter would qualify as a loan modification “offer”

because if Crist performed its terms, as requested in the offer, a permanent modification would

be granted. That same contractual analysis applies whether or not HAMP or HBOR is also at

issue.

As a result, Defendants were unable to record a notice of default or notice of sale or

conduct a trustee’s sale until Crist failed to accept the offer within 14 days. The declaration from

Tarver indicates Crist did not accept the December 9, 2025 loan modification offer and it

subsequently sent her a letter noting her failure to accept. (Tarver Decl. at ¶¶ 11-12.)

In these circumstances, it appears that the TPP constituted an offer, there was no

acceptance of the offer within the 14-day period, so the foreclosure could resume. The February

4, 2026 letter therefore merely advised Crist as much and did not constitute a rejection for

purposes of section 2923.6. That is consistent with general contract principles, which indicate an

offer is revoked by the lapse of a reasonable time without communication of the acceptance (Civ.

Code, § 1587) except in this case the “reasonable time” is substituted by statute with the 14-day

period. As a result, Crist has not shown a likelihood of success as to her sixth cause of action

because the foreclosure was properly not pursued until after the 14-day period. And to the extent

it is based upon the prior foreclosure sale efforts, those efforts never materialized with an actual

sale.

2. Civil Code section 2924f Claim

Civil Code section 2924f, subdivision (f)(1), provides that “the mortgagee, beneficiary, or

authorized agent shall provide to the trustee a fair market value of the property at least 10 days

prior to the initially scheduled date of sale, and the trustee shall not sell the property at the first

sale at which a bid can be made for less than 67 percent of that fair market value of the property.

The trustee may rely on the fair market value provided pursuant to this paragraph, and shall not

have a duty to verify the source or accuracy of the valuation.” If the property remains unsold

after the first sale, then the trustee shall postpone the sale for at least seven days and then the

property may be sold to the highest bidder. A failure to comply, however, “shall not affect the

validity of a trustee’s sale or a sale to a bona fide purchaser for value.” (Civ. Code, § 2924f,

subd. (f)(2)-(4).)

In this case, Crist contends that the initial foreclosure sale was invalid as a violation of

section 2923.6 and therefore the second sale was subject to section 2924f, but the bid which was

accepted at the second sale was less than 67 percent of the fair market value of the property. The

evidence indicates Nester accepted a bid of $317,000, but the value of the property was

$1,085,000, which means the sale had to be postponed for at least seven days. Crist submits an

appraisal to support her claim and states her “belief” that the property sold at the foreclosure for

$317,500. (Crist Decl. at ¶¶ 5 and 31, Ex. E.)

In opposition, Defendants do not dispute that the property sold for less than 67 percent of

its fair market value or that there was no postponement of the sale on March 3, 2026. Nor do

Defendants dispute the factual assertions underlying Crist’s contention that the attempted sale on

October 28, 2025 should not count as the “initial” sale for purposes of section 2924f because

Defendants lacked the ability to pursue the sale based on their violation of section 2923.6; the

evidence suggests that Crist’s loan modification application was under review at the time of the

October 28, 2025 sale. (Crist Decl. at ¶¶ 20-27.)

But the defense argues that section 2924f does not apply after the sale has been

postponed, i.e., it does not merely apply to the “first scheduled sale date in which a bid of 67

percent was not achieved.” (Opposition at 8:8.) This argument has intuitive appeal; after all, the

only way that a trustee could know that a bid of 67% is not achieved is if a sale was actually

attempted.

It is also notable that section 2924f allows the mortgagee to provide the trustee with the

fair market value at least 10 days before the “initially scheduled date of sale,” but the statute then

prohibits the sale “at the first sale at which a bid can be made.” In other words, the statute makes

a distinction between the two types of sale dates. In this regard, a mere postponement does not

take the subsequent sale out of the purview of section 2924f unless the initial sale was one at

which a bid could be made. (California Bill Analysis, A.B. 2424 Assem., 6/24 in Senate/2024

[“If the first auction does not result in an eligible sale, the trustee must postpone the sale for at

least seven days, and the property may then be sold to the highest bidder in the subsequent

auction”].)

Defendants next indicate a sale on October 28, 2025 was attempted and the FAC

concedes the sale was postponed because the highest bid was for less than the 67% threshold.

(FAC at ¶ 27.) Thus, the March 2026 sale was not the initial sale for purposes of section 2924f

and it did not need to be postponed again. Even if the attempted sale on October 28, 2025

violated section 2923.6, it was still a sale at which bids could be received. As section 2924f

indicates, a failure to comply with the 10-day postponement due to low bids “shall not affect the

validity of the trustee’s sale or a sale to a bona fide purchaser for value.” (Civ. Code § 2924f,

subd. (f)(4).) There is also no apparent injunctive relief available if the sale is not postponed.

(See Civ. Code § 2924.12 [providing for injunctive relief for various material violations of

HBOR, but not referencing section 2924f].)

Furthermore, the stated purpose of the legislation was to prevent the significant loss of

home equity because “foreclosure auctions do not attract the same level of interest from potential

buyers as typical real estate transactions” (California Bill Analysis, A.B. 2424 Assem., 6/24 in

Senate/2024), but the Legislature apparently believed, in enacting the changes to section 2924f, a

short continuance would allow time to gain more interest in the property to increase the bid

amount. That occurred in this case. The property was not sold initially due to the low bid

received and the continuance therefore afforded more time for interested parties to participate

considering the low bid amount and the higher purported fair market value. The mere fact that

the initial attempted sale violated section 2923.6 does not mean the subsequent sale violated

section 2924f as well.

Overall, while the at-issue portion of section 2924f is relatively new law, it appears

Defendants have the better position regarding the merits of the claim.

3. Crist’s Other Causes of Action While the FAC contains several other causes of action, and while the motion factually

references the alleged double payment on the insurance, etc., the only analysis and arguments

advanced in the opening papers supporting the requested injunction are based upon Civil Code

sections 2923.6 and 2924f, analyzed in the preceding subsections. (See Opening Brief at pp. 9-

15.) The other causes of action are therefore not advanced in support of the injunction and cannot

support Plaintiff’s position on likelihood of success.

B. The Interim Harm Prong

1. Risk of Harm to Plaintiff

As for the interim harm prong, real property is deemed unique such that “injury or loss

cannot be compensated in damages, and injunctive relief is therefore more readily granted.” (Cal.

Prac. Guide Civ. Pro. Before Trial Ch. 9(II)-A [citing Civ. C. § 3387—damages presumed

inadequate for breach of agreement to convey real property; Aspen Grove Condominium Ass’n v.

CNL Income Northstar LLC (2014) 231 Cal.App.4th 53, 62-64—invasion of plaintiff’s land by

continuous trespass of water warranted injunction regardless of damages].) But where real

property is held for investment purposes, damages are more appropriately seen as an adequate

remedy warranting denial of injunctive relief. (Jessen v. Keystone Sav. & Loan Ass’n (1983) 142

Cal.App.3d 454, 458 [refusing preliminary injunction to restrain foreclosure sale].)

At issue here are Crist’s rights and interest in real property, which as noted are generally

unique and supportive of injunctive relief. The evidence submitted also suggests the property is

Crist’s primary residence. (Crist, Ex. F [loan modification application].)

In the opposition, Defendants merely suggest that they would be harmed because Crist

has not paid the debt owed and an element of an action to set aside a trustee’s sale is the tender

of the debt owed. However, the debt is purely monetary and any harm to Defendants can

therefore be addressed via a bond. In this regard, and as between Crist and Defendants, the

balancing of interests weighs in favor of an injunction.

2. Risk of Harm to Bona Fide Purchasers Defendants also claim that the Court cannot possibly balance the interests correctly

because Crist has failed to join indispensable parties, namely, the buyers at the foreclosure sale

and the post-foreclosure “overbidders.” Crist essentially seeks to set aside the foreclosure sale.

“When a party seeks to set aside and vacate a trustee’s sale in a foreclosure proceeding, there can

be no doubt that the parties to the sale transaction are indispensable parties.” (Washington

Mutual Bank v. Blechman (2007) 157 Cal.App.4th 662, 668.) Although the trustee’s deed upon

sale was (apparently) not actually issued, there was nevertheless a “sale transaction” via the

highest bid and therefore the successful bidder would be an indispensable party. (See Lee v. Rich

(2016) 6 Cal.App.5th 270, 277—third party purchaser at execution sale was an indispensable

party].)

While the injunction in this case would be directed at Defendants and prohibit their

transfer of title pursuant to the foreclosure, the third-party purchaser would be directly affected

by the order since that party would not receive title. Therefore, to the extent the purchaser should

be added as a party, the Court should weigh the harm the injunction would cause to the purchaser

in addressing the injunction. Without hearing from the purchaser, the Court cannot adequately

balance the harms. But since Plaintiff has not established a likelihood of success on the merits,

per Section III.A. above, and since the Court has sufficient information to assess the risk of harm

to Plaintiff herself, the Court need not further pursue or address the joinder issue.

XI. CONCLUSION

4. Plaintiff’s Motion for a Preliminary Injunction is respectfully DENIED.

5. The Temporary Restraining Order issued April 16, 2026 is DISSOLVED and

shall have no further force or effect.

6. The $10,000 undertaking (bond) posted by Plaintiff shall remain in place for

thirty (30) days from the date of this Order to allow Defendants to file any motion for damages

sustained by reason of the Temporary Restraining Order. If no motion is filed within that period,

the bond shall be EXONERATED without further order of the Court.

IT IS SO ORDERED.

Dated: [TENTATIVE – NOT FINAL] Hon. Joseph B. Widman Judge of the Superior Court