You can pay your note off up until the redemption period. In California, that is five (5) days prior to the Trustee Sale. If you have access to these types of funds, a discounted pay off may be an option.
For example, your parents or another source of private funding can loan or gift you an amount that is reasonably close to the loan payoff amount; the lender may accept this as payment in full. If these types of funds are at your disposal, consider offering the lender less than the full note balance (to start the negotiations).
The lender's decision-making process to accept such terms is similar to selling your home via a short sale to a private seller. It is imperative that the lender is able to substantiate your inability to pay off the loan deficiency. The lender will examine your income and expense statement thoroughly. There are potential tax consequences relating to deficiencies so you should consider seeking the advice of a Certified Public Accountant (CPA).
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The information contained in this report is deemed to be accurate but is not guaranteed.
Sources: "The Foreclosure Bible" and the California Association of Realtors®