The One Form of Action Rule – Recovery of Any Right Secured by Deed of Trust or Mortgage

In California, Code of Civil Procedure section 726 provides that “there can be but one form of action for the recovery of any debt or the enforcement of any right secured by mortgage upon real property or an estate for years therein.” This rule only applies to real property and not personal property.

Prior to commencing an action to recover on a breach of a deed of trust or mortgage, the creditor must therefore consider the one action rule, otherwise it risks losing the security for the loan.

This rule is of increasing importance in the current real estate market where the number of foreclosures continue to increase. Therefore, a creditor, whether it be a bank or other private lender, should consider all of its implications before attempting to recover a debt secured by real property in the state of California.