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By Brian Hews
Publisher | Follow X
January 30, 2026
In November of last year, a Los Cerritos Community News investigation put then Bellflower District 4 Councilman, now Mayor Pro Tem, Victor Sanchez at the center of a residency controversy after public records showed he declared a Somerset Street duplex in District 1 as owner-occupied. That designation appeared in two recorded documents — a Grant Deed and a Deed of Trust tied to a $421,000 loan.
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Those owner-occupied designations raised significant legal questions about whether, under California law, Sanchez’s principal residence is in District 1 rather than District 4, the district he was elected to represent.
But the residency issue is only part of the fallout. The Somerset loan documents raised separate and more serious questions regarding loan representations — issues that exist independently of any residency dispute and that mortgage professionals say lenders treat as material.
Sanchez won the District 4 City Council seat in 2020. In January 2022, Sanchez and his wife were gifted a half interest in the Somerset duplex from Sanchez’s parents, a transfer memorialized in a recorded Grant Deed filed with Los Angeles County.
That Grant Deed stated the transfer was made to “an owner-occupier as part of a bona fide gift” to Sanchez and his wife, and contained no language limiting the owner-occupancy designation to a single grantee.
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GRANT DEED gifting half of the duplex on Somerset (upper yellow) and the owner/occupied box marked (lower yellow) showing it is owner-occupied. Click on image to enlarge, click again to reduce.
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Just days after the gift transfer, Sanchez obtained a $421,000 loan secured by the Somerset property. Consistent with the owner-occupier language in the Grant Deed above, the recorded Deed of Trust designated the duplex as an owner-occupied primary residence. Sanchez, his wife, and his parents all signed the Deed of Trust, certifying that occupancy designation in a recorded, notarized instrument.
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OWNER-OCCUPIER: The document lists the Somerset property as an owner-occupied home and uses that status to claim an exemption from a state recording fee. “Exempt from fee per GC 27388; recorded concurrently ‘in connection with ‘ a transfer of real property that is a residential dwelling TO AN OWNER OCCUPIER. Click on image to enlarge, click again to reduce.
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Mortgage professionals consulted by LCCN said the loan was unusual and appears to have been possible only because Sanchez’s parents remained on title. Borrowers are typically required to observe a seasoning period following a transfer of ownership before getting a loan that size, or to demonstrate a longer payment history prior to being added to title.
Notably, Sanchez’s Statement of Economic Interests (Form 700) required annual filings at the time he assumed office in 2020 show no comparable investment activity, nor did his 2021 filing. That changed in 2022, when Sanchez reported substantial investments in numerous major publicly traded companies, collectively valued in the hundreds of thousands of dollars. The timing of those disclosures coincides with the period in which the $421,000 Somerset loan was obtained.
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STOCK PURCHASE: One page from Sanchez’ 2022 700 Forms showing 2022 purchase of Apple, Meta, Netflix and Nike with boxes checked indicating value between $10,000 and $100,000. Click on image view 2020-2022 700 Forms.
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The Deed of Trust formally classified the Somerset duplex as owner-occupied, effectively treating it as a primary residence located outside the district Sanchez was elected to serve. That owner-occupied designation appears in both the Grant Deed and the loan documents, with no recorded limitation, rider, carve-out, or exemption.
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In the California Uniform Deed of Trust used for Fannie Mae and Freddie Mac loans, the occupancy requirement states, “Borrower shall occupy the Property as Borrower’s principal residence.” That language appears in Section 6 of the Deed of Trust shown above. “Borrower” is defined in the document as everyone who signed it, and “principal residence” is the legal term lenders use to mean owner-occupied. This is not a casual description; it is a required promise made in a sworn, notarized, and recorded document. In mortgage lending, courts, lenders, and regulators treat “principal residence” and “owner-occupied” as the same thing. The image below shows the signatures of the borrowers on the Deed of Trust, including Mayor Pro Tem Victor Sanchez, confirming his execution of the instrument containing that occupancy requirement.
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Despite those recorded representations, Sanchez later acknowledged to LCCN that he never moved into the Somerset duplex and never intended to live there.
“The Somerset property that I own in part was occupied by one of the owners, but I never moved there and never had an intent to permanently live there,” Sanchez wrote.
That admission directly conflicts with the owner-occupancy certification contained in the recorded loan documents. Mortgage professionals told LCCN that owner-occupancy status is a important underwriting condition because it affects pricing (points) and loan approval.
Under California law, knowingly making false statements in connection with obtaining or refinancing a mortgage can expose a borrower to legal scrutiny.
Because the owner-occupancy certification was made in a sworn, recorded instrument, conflicting representations may also implicate perjury statutes or trigger state or federal review. Federal law similarly prohibits knowingly providing false information to influence a federally related lending transaction.
Separately, the contradiction between Sanchez’s signed owner-occupancy documents and his admission that he never lived at the Somerset property revives unresolved questions about his eligibility to continue holding his District 4 council seat.
Sanchez has claimed that he lives in District 4, citing his Maple Street address, voter registration, where his family resides, and where he receives mail as evidence of residency. But California law does not treat such assertions as determinative when residency is disputed.
In a 2014 opinion, the California Attorney General authorized a quo warranto action to determine whether a city councilmember lawfully holds office based on district residency, emphasizing that eligibility turns on actual residence rather than explanations of intent or convenience. The Attorney General concluded that when residency is in question, the issue is properly resolved by the courts, not by an official’s after-the-fact assertions.
In his correspondence with LCCN, Sanchez repeatedly stated that he checked a box in the unrecorded loan application indicating he would not occupy the Somerset property. However, the only recorded, notarized instrument governing the loan — the Deed of Trust — classifies the duplex as owner-occupied and bears his signature without any non-occupant exemption.
Unrecorded documents do not override recorded instruments; the public Deed of Trust is the controlling legal document.
That Deed of Trust identified the property as owner-occupied, claimed a recording fee exemption based on that status, and imposed a single occupancy covenant on “the borrower.” All four borrowers signed it. There is no rider, carve-out, or recorded clause designating Sanchez as a non-occupant or limiting the occupancy requirement to another party.
The law is not kind to conflicting sworn statements, especially when they appear in recorded mortgage documents and are later contradicted in writing.
California and federal law treat mortgage representations as material statements, not technicalities. Penal Code section 532f prohibits false statements made to secure a real estate loan, while federal law under 18 U.S.C. section 1014 criminalizes knowingly providing false information to influence a federally related mortgage transaction. Those statutes do not hinge on intent after the fact, but on what was represented at the time the loan was obtained.
LCCN is continuing its review of the Somerset property and is now examining additional records related to other activity at the duplex and how that use aligns with the property’s owner-occupied loan classification. That reporting will appear in a subsequent installment.
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