(a) If the levying officer receives a sufficient deposit from the creditor, the levying officer shall promptly tender or pay the deposit to the secured party or lienholder who made the third-party claim except that, if the deposit is made by personal check, the levying officer is allowed a reasonable time for the check to clear.
§ 720.290.Payment of Deposit to Secured Party Or Lienholder
Title 9. Enforcement of Judgments · Division 4 · Chapter 3. Third-Party Claim of Security Interest or Lien · Enacted 1982 · no amendments on record · Last verified July 28, 2026
In one sentenceSection 720.290 requires the levying officer to promptly tender a creditor's deposit to the secured party or lienholder who made the claim, shifts the interest in the property to the creditor once that tender is accepted, and directs any refused deposit to the county treasurer payable to the claimant instead.
Full Text of § 720.290
(b) If the tender is accepted, the interest of the secured party or lienholder in the property for which deposit is made passes to the creditor making the deposit and, on distribution of any proceeds under Section 701.810, the creditor who makes the deposit shall be entitled to the proceeds to the extent of the deposit in the priority of the interest for which the deposit is made.
(c) If the tender is refused, the amount of the deposit shall be deposited with the county treasurer payable to the order of the secured party or lienholder.
Plain-English Summary
When a creditor chooses to make a deposit under § 720.260 instead of posting an undertaking, this section governs what happens to that money. The levying officer has to promptly tender or pay the deposit to the secured party or lienholder who made the claim -- though a personal check earns the officer a reasonable clearing period before the tender goes out.
If the secured party or lienholder accepts the tender, that acceptance does real legal work: the claimant's interest in the property passes to the creditor who made the deposit. From that point, if proceeds are later distributed under § 701.810, the creditor steps into the claimant's shoes and collects to the extent of the deposit, in the same priority the claimant's interest would have held.
A claimant isn't forced to accept the money, though. If the tender is refused, subdivision (c) requires the deposit to go instead to the county treasurer, held payable to the order of the secured party or lienholder -- available to be claimed later even though it's no longer sitting with the levying officer.
Frequently Asked Questions
What does the levying officer do with a creditor's deposit?
Promptly tender or pay it to the secured party or lienholder who made the third-party claim, allowing a reasonable time for a personal check to clear.
What happens if the lienholder accepts the deposit?
The lienholder's interest in the property passes to the creditor who made the deposit, and on any later distribution of proceeds under § 701.810, that creditor collects to the extent of the deposit in the priority the lienholder's interest held.
What if the secured party or lienholder refuses the deposit?
Section 720.290(c) requires the deposit to be placed with the county treasurer, payable to the order of the secured party or lienholder.
Amendment History
Added by Stats. 1982, Ch. 1364, Sec. 2. Operative July 1, 1983, by Sec. 3 of Ch. 1364.
Source & verification. Section text is reproduced verbatim from
the Deering's California Codes Annotated / vLex. Enacted by the California Legislature.
Last verified July 28, 2026.
· Official source
Also known as: deposit third party claim californiacreditor deposit lienholder priority