Understanding Trustee's Sales in Real Estate Transactions

 
Trustee’s Sales
 
 
Ari Ramras
ramraslegal.com
 
The TSG
 
Jacket
 
The TSG
 
Assures (indemnifies) against loss by reason of
incorrectness of:
Who has title (Sch. A) subject to “exceptions” (Sch.
B)
Who is entitled to notice—where to mail
Where the land is—where to publish and post
 
The TSG
 
“Exceptions”
Any matter affecting title
May be disclosed in recording order
Not necessarily in order of priority
 
The TSG
 
Who is entitled to notice—who gets what
Trustor and original beni (5-day notice after
recording NTS)
With statement of breach
Anyone recording a request for notice 
and
anyone
 with an interest (30-day notice after
recording NTS)
Subordinate
 interest holders also receive statement of
breach and that interest subject to being terminated
 
Example statements of breach
 
The TSG
 
Who is entitled to notice—
where do they get it
Addresses of trustor and original beni
To address specified in the deed of trust
Notice also mailed to the property address of a single
family residence
Addresses of other interest holders
To address set forth in document
Even if returned to sender undelivered
OR if none,
c/o person to whom document was directed to be mailed when
recorded; OR
to any other address known or ascertained by trustee
 
 
The TSG
 
Can re-foreclose if you miss something
CS&W Contractors, Inc. v. Southwest Sav. & Loan
Ass’n
, 175 Ariz. 55 (Ariz.App. 1992), 
vac. in part on
other grounds
, 180 Ariz. 167 (1994) (trustee’s sale
can be reconducted when lienholder inadvertently
omitted from the list of those given notice)
 
The TSG
 
Where the land is
A.R.S. 33-808(C): the NTS must contain “the
street address, if any, or identifiable location
as well as the legal description of the trust
property” and the APN
 
 
The TSG
 
Where the land is
A.R.S. 33-808(E):
Any error in the legal description of the trust
property shall not invalidate a trustee's sale if
considered as a whole the information provided is
sufficient to identify the trust property 
being sold.
If there is an error or omission in the legal
description so that the trust property cannot be
identified…the trustee shall record a cancellation
of notice of sale.
 
The TSG
 
Where the land is
Does not necessarily need to match the legal
description in the deed of trust
What if the legal in the DOT is wrong?
It may still be valid
Manicom v. CitiMortgage
: Although a legal description is the
“preferred method of identifying trust property…what is
essential is that the property be identified with a 
sufficient
certainty 
in the public record.”
It could be re-recorded is some cases
Has a third party or bankruptcy intervened?
The NTS cannot be re-recorded
 
What description is sufficient?
Examples
 
What description is sufficient?
Examples
 
What description is sufficient?
Examples
 
What description is sufficient?
Examples
 
Any Doubt?
 
Foreclosing could exacerbate the problem—
A.R.S. 33-420 slander of title exposure
Stauffer v. U.S. Bank
: a Notice of Trustee’s Sale is a
document that asserts an interest in real property
within the meaning of A.R.S. 33-420
SWC Baseline and Crimson Investors v. Augusta Ranch
:
a beneficiary under a deed of trust may be liable
under A.R.S. 33-420 when it has “constructive
knowledge through the Recorder’s Office that title [to
the trust property] was held by” someone other than
the trustor
 
 
The TSG
 
Note other insurability
concerns?
e.g. lack of access
 
Insuring Post-Trustee’s Sale
Statutory Protections
 
A.R.S. 33-811(C): 
The trustor, its successors or
assigns, and all persons to whom the trustee
mails a notice of a sale
 under a trust deed
pursuant to § 33-809 shall 
waive all defenses 
and
objections to the sale not raised in an action that
results in the issuance of a court order granting
relief pursuant to rule 65, Arizona rules of civil
procedure, entered before 5:00 p.m. mountain
standard time on the last business day before the
scheduled date of the sale.
Notice required in the first paragraph of the NTS.
 
Insuring Post-Trustee’s Sale
Statutory Protections
 
A.R.S. 33-811(B): The trustee's deed shall raise the
presumption of compliance with the requirements
of the deed of trust and this chapter relating to the
exercise of the power of sale and the sale of the
trust property, including recording, mailing,
publishing and posting of notice of sale and the
conduct of the sale. A trustee's deed shall
constitute 
conclusive evidence 
of the meeting of
those requirements 
in favor of purchasers or
encumbrancers for value and without actual notice
.
Knowledge of the trustee shall not be imputed to
the beneficiary
.
 
Insuring Post-Trustee’s Sale
Statutory Protections
 
A.R.S. 33-811(E):
“The trustee's deed shall 
operate to convey 
to the
purchaser the 
title, interest and claim of the trustee,
the trustor, the beneficiary, their respective successors
in interest and all persons claiming the trust property
sold by or through them
, 
including all interest or claim
in the trust property acquired subsequent to the
recording of the deed of trust and prior to delivery of
the trustee's deed
.”
Still moving 5-day window for IRS liens
If IRS lien recorded more than 30 days before the actual sale date,
notice must be given to the IRS 25 days before the sale
 
Insuring Post-Trustee’s Sale
Statutory Protections
 
A.R.S. 33-811(E) continued:
The “conveyance shall be 
absolute
 without
right of redemption and 
clear of all liens,
claims or interests that have a priority
subordinate
 to the deed of trust and shall be
subject to all liens, claims or interests that
have a priority 
senior to the deed of trust”
Junior liens may reattach if trustor purchases
 
Insuring Post-Trustee’s Sale
Statutory Protections
 
Governmental liens (e.g. abatement
liens) recorded after the notice of
trustee’s sale is recorded?
Some ordinances require trustee
and beneficiary to report to the
municipality if the property is
abandoned
Slide Note
Embed
Share

Explore the intricacies of trustee's sales in real estate deals, covering important aspects such as who is entitled to notice, exceptions affecting title, and the process to follow in case of breach. Learn about the importance of accurate information in trustee's sales and the potential repercussions of missing critical details.


Uploaded on Aug 18, 2024 | 0 Views


Download Presentation

Please find below an Image/Link to download the presentation.

The content on the website is provided AS IS for your information and personal use only. It may not be sold, licensed, or shared on other websites without obtaining consent from the author. Download presentation by click this link. If you encounter any issues during the download, it is possible that the publisher has removed the file from their server.

E N D

Presentation Transcript


  1. Trustees Sales Ari Ramras ramraslegal.com

  2. The TSG Jacket

  3. The TSG Assures (indemnifies) against loss by reason of incorrectness of: Who has title (Sch. A) subject to exceptions (Sch. B) Who is entitled to notice where to mail Where the land is where to publish and post

  4. The TSG Exceptions Any matter affecting title May be disclosed in recording order Not necessarily in order of priority

  5. The TSG Who is entitled to notice who gets what Trustor and original beni (5-day notice after recording NTS) With statement of breach Anyone recording a request for notice and anyone with an interest (30-day notice after recording NTS) Subordinate interest holders also receive statement of breach and that interest subject to being terminated

  6. Example statements of breach

  7. The TSG Who is entitled to notice where do they get it Addresses of trustor and original beni To address specified in the deed of trust Notice also mailed to the property address of a single family residence Addresses of other interest holders To address set forth in document Even if returned to sender undelivered OR if none, c/o person to whom document was directed to be mailed when recorded; OR to any other address known or ascertained by trustee

  8. The TSG Can re-foreclose if you miss something CS&W Contractors, Inc. v. Southwest Sav. & Loan Ass n, 175 Ariz. 55 (Ariz.App. 1992), vac. in part on other grounds, 180 Ariz. 167 (1994) (trustee s sale can be reconducted when lienholder inadvertently omitted from the list of those given notice)

  9. The TSG Where the land is A.R.S. 33-808(C): the NTS must contain the street address, if any, or identifiable location as well as the legal description of the trust property and the APN

  10. The TSG Where the land is A.R.S. 33-808(E): Any error in the legal description of the trust property shall not invalidate a trustee's sale if considered as a whole the information provided is sufficient to identify the trust property being sold. If there is an error or omission in the legal description so that the trust property cannot be identified the trustee shall record a cancellation of notice of sale.

  11. The TSG Where the land is Does not necessarily need to match the legal description in the deed of trust What if the legal in the DOT is wrong? It may still be valid Manicom v. CitiMortgage: Although a legal description is the preferred method of identifying trust property what is essential is that the property be identified with a sufficient certainty in the public record. It could be re-recorded is some cases Has a third party or bankruptcy intervened? The NTS cannot be re-recorded

  12. What description is sufficient? Examples

  13. What description is sufficient? Examples

  14. What description is sufficient? Examples

  15. What description is sufficient? Examples

  16. Any Doubt? Foreclosing could exacerbate the problem A.R.S. 33-420 slander of title exposure Stauffer v. U.S. Bank: a Notice of Trustee s Sale is a document that asserts an interest in real property within the meaning of A.R.S. 33-420 SWC Baseline and Crimson Investors v. Augusta Ranch: a beneficiary under a deed of trust may be liable under A.R.S. 33-420 when it has constructive knowledge through the Recorder s Office that title [to the trust property] was held by someone other than the trustor

  17. The TSG Note other insurability concerns? e.g. lack of access

  18. Insuring Post-Trustees Sale Statutory Protections A.R.S. 33-811(C): The trustor, its successors or assigns, and all persons to whom the trustee mails a notice of a sale under a trust deed pursuant to 33-809 shall waive all defenses and objections to the sale not raised in an action that results in the issuance of a court order granting relief pursuant to rule 65, Arizona rules of civil procedure, entered before 5:00 p.m. mountain standard time on the last business day before the scheduled date of the sale. Notice required in the first paragraph of the NTS.

  19. Insuring Post-Trustees Sale Statutory Protections A.R.S. 33-811(B): The trustee's deed shall raise the presumption of compliance with the requirements of the deed of trust and this chapter relating to the exercise of the power of sale and the sale of the trust property, including recording, mailing, publishing and posting of notice of sale and the conduct of the sale. A trustee's deed shall constitute conclusive evidence of the meeting of those requirements in favor of purchasers or encumbrancers for value and without actual notice. Knowledge of the trustee shall not be imputed to the beneficiary.

  20. Insuring Post-Trustees Sale Statutory Protections A.R.S. 33-811(E): The trustee's deed shall operate to convey to the purchaser the title, interest and claim of the trustee, the trustor, the beneficiary, their respective successors in interest and all persons claiming the trust property sold by or through them, including all interest or claim in the trust property acquired subsequent to the recording of the deed of trust and prior to delivery of the trustee's deed. Still moving 5-day window for IRS liens If IRS lien recorded more than 30 days before the actual sale date, notice must be given to the IRS 25 days before the sale

  21. Insuring Post-Trustees Sale Statutory Protections A.R.S. 33-811(E) continued: The conveyance shall be absolute without right of redemption and clear of all liens, claims or interests that have a priority subordinate to the deed of trust and shall be subject to all liens, claims or interests that have a priority senior to the deed of trust Junior liens may reattach if trustor purchases

  22. Insuring Post-Trustees Sale Statutory Protections Governmental liens (e.g. abatement liens) recorded after the notice of trustee s sale is recorded? Some ordinances require trustee and beneficiary to report to the municipality if the property is abandoned

  23. Trustees Sales HUD Non-Judicial Foreclosures Judicial Foreclosures Notice 91-day notice: Anyone with an interest at time of recording NTS 21-day notice: Anyone with an interest 45 days before sale Service per rules of civil procedure Deed operates to convey interests acquired after recording DOT Potential gap Notice of lis pendens may be recorded Anyone mailed notice waives defenses Including subordinate claimants with actual knowledge and claimants under statutory liens Conclusive evidence of compliance with requirements for BFPs

Related


More Related Content

giItT1WQy@!-/#giItT1WQy@!-/#giItT1WQy@!-/#