Tuesday, December 29th, 2009
Dave Dinkel asked:
The impact of foreclosure on your credit score is the most frequently asked question we get. The method of calculating a credit score (FICO Score) is proprietary information. What complicates the issue even further is that all credit information is calculated into the individual’s credit score as it is entered by creditors and is only updated whenever there is an inquiry.
The second most asked question is “How soon does the foreclosure go on my credit report?” This depends on the lender but in the vast majority of cases, as soon as the homeowner is 90 days late (30 days in some states), the foreclosure info is filed with the credit reporting agencies. It will not be “reversed” by a short sale or a deed in lieu of foreclosure unless negotiated by the homeowner, and often that doesn’t work.
So with the foreclosure question, the homeowner’s credit score is first decreased by his late payments. Usually, he is also late on other bills because of his financial crisis and has additional late payments, collections, or even judgments that all lower his credit score. So if he had his credit score of 680 on a specific date before he started his personal financial decline, after he has been served with his foreclosure notice or even after the foreclosure is completed; his new score could be 420 or lower.
He is usually shocked and dismayed, but the real problem is how much more interest the lenders want because of his low credit score. For example, an auto loan could cost a “D” credit customer as much as $13,000 more for the same car as the “A” credit buyer! The “D” credit person is penalized for his credit situation since the collateral is the same.
The foreclosure’s actual point impact on an individual’s credit report has recently gotten somewhat higher and is estimated to be from 125 to 175 points. The bigger impact is from the late payments on other bills which continue to mount up further reducing his credit score.. The net effect is generally considered to be about a 240 – 260 point decline counting his late mortgage payments. Ironically, the lower your credit score to start, the less the impact of additional late payments, and if you get into the 400’s, it’s really hard to get much lower without almost trying to hurt yourself. Many of the items on any credit report can be removed over time. It requires persistence and it’s estimated that 30% of all items on credit reports are incorrect and can be removed just by an inquiry or showing a paid invoice. Also the credit score reduction for the foreclosure is reduced as time goes on, until it settles at a minimal deduction (50 to 75 points) after a few years.
It is absolutely untrue that once you have had a foreclosure you can never buy a home again, as we see people buying a new home within a year of losing theirs to foreclosure. There are even homeowners who legally buy homes within 30 days of their foreclosure using legal techniques with no cash and no credit.
Foreclosure victims, who want to do conventional financing in the future, will have to pay a higher interest rate (approximately 1 and a half to 2%) unless their down payment could be 10% to 20% of the purchase price. This sizable down payment can often be obtained from friends or family members and carried as a second mortgage or second deed of trust on the property.
I am often asked if doing a “Deed in Lieu of Foreclosure” or a “Short Sale” with the lender reports the same as a foreclosure. Unfortunately, depending on how the lender reports your foreclosure, it could stay on your report even if the lender accepts your deed to resolve the foreclosure. The foreclosure action does not have to be filed in the courts to be considered a “foreclosure” by the lender. If your lender accepts a “Deed in Lieu Of Foreclosure” or a “Short Sale”, always them ask for a letter explaining they have accepted your deed in exchange for your home, and that they will retract or not put a foreclosure notification in your credit record. If they tell you they have to, it’s not true, ask for a Supervisor until you get your letter.
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Category Credit | Tags: Tags: Collateral, Credit Report, Deed In Lieu Of Foreclosure, Proprietary Information,
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Sunday, December 27th, 2009
Robert Barr asked:
Even the most responsible are sometimes caught up in situations beyond their control, and faced with consequences which can, almost overnight, lay waste to years of careful planning.. Millions of American homeowners who took on the responsibilities of a mortgage in the past few years now find themselves teetering on the brink of foreclosure, trapped in a collapsing housing market which will not let them get out of homes they can no longer afford.
But there are mortgage foreclosure solutions available, and you too may be able to stop foreclosure if you research the kinds of foreclosure help now available. If you can’t save your home, you can, at the very least, save your credit rating by keeping it free of a foreclosure record.
When it comes to mortgage foreclosure solutions, speed is of the essence, and as soon as you find yourself wondering where the next monthly house payment will come from, it’s time to act. Don’t feel intimidated when the foreclosure notice arrives; ignoring your plight will accomplish nothing. Contact a mortgage foreclosure prevention specialist as soon a possible, because it is the best way to stop the foreclosure machine from mowing you and your loved ones down where you stand.
You can find many specialists in mortgage foreclosure prevention with an online search, so look for local attorneys familiar with foreclosure laws. Take the time, however, to get some background on any consultants you are considering, because the current foreclosure crisis has given rise to an entire culture of foreclosure scam artists who have nothing good in mind for those in your position. They will happily relieve you not only of your home, but also of the money you put up for their services, and you will still be faced with foreclosure.
You can also begin your quest for mortgage foreclosure solutions with an area debt counseling agency, which may be able to solve your problems by negotiating a modified payment schedule with your lender. A debt counselor can also offer advice on refinancing your mortgage at a lower interest rate, or even selling your home while it is still in preforeclosure.
You may be surprised to learn that your bank is not eager to foreclose on your home, and your best chance to avoid foreclosure may actually lie in sitting down with your banker to determine your options to avoid foreclosure. No bank in the world is thrilled with the idea of having to insure and maintain an empty home, so keeping you in it even if you are only making interest payments for the time being may, from the bank’s point of view, be an attractive alternative to foreclosure.
And above all, learn about your rights concerning foreclosure. Become familiar with terms like recasting, home equity loan term modification, and special forbearance, and if none of the professionals with whom you are dealing mention them, don’t hesitate to bring them up yourself. Your home and your financial future are in no one’s hands but your own!
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Category Real Estate | Tags: Tags: American Homeowners, Credit Rating, Money, Mortgage Foreclosure Prevention,
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Saturday, December 26th, 2009
Joseph asked:
Whatever pertaining to foreclosure-shortsaleonlyus.com
Foreclosure, a term very common nowadays in various countries, is a process in which a lender, or mortgagee, obtains the right to cancel the borrower’s equitable right in a property. This happens when a borrower, who has mortgaged his property, defaults his return payment to the mortgagee. Both lender and borrowers should have a thorough knowledge of whatever pertaining to foreclosure. Foreclosures from all parts of the world make a striking alarm for every house owner to have the knowledge of foreclosure. Most of the foreclosures are carried out through a court order and whatever pertaining to foreclosure should have the legal processes associated with it.
Foreclosure process can be initiated by the lien-holder if the mortgagor didn’t repay the loan within the deadline set for repayment. However, one has to careful with conditions related to foreclosures. Property owners can have a grace period, normally known as pre-foreclosure period, for repaying the outstanding amount. Until the end of the pre-foreclosure period, lenders cannot cancel the equitable rights of the property owner and whatever pertaining to foreclosure can only be taken after the pre-foreclosure period. During the pre-foreclosure period, the mortgagor can sell his property to anyone in order to repay his default amount voluntarily.
Foreclosure process is almost same everywhere but different states follow different rules for foreclosures. For example, let’s check the foreclosure laws of two different states say Alabama and Illinois. Judicial foreclosures as well as non-judicial foreclosures are available in Alabama, whereas only judicial foreclosures are available in Illinois. Alabama, like most states, allows a redemption period of 12 months, while Illinois doesn’t allow any right of redemption. Foreclosures can be carried out through mortgages or deeds of trusts in Alabama, while Illinois allows a variety of options for foreclosures. Hence, lien-holders, as well as mortgagor, should be aware of whatever pertaining to foreclosure laws depending upon their locality. It is a wise option to get the advice of a lawyer, or real estate advisor, who has been specialized in this field for many years.
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Despite facing a housing market slowdown, investing on a foreclosed property is still considered a good deal in terms of potential profit. Foreclosed properties and REOs can be bought for cheap prices, considerably lower than the market values, and can be sold for higher prices. Foreclosed properties can be bought at a much lower price because many mortgage lenders will be in a mindset to divest the properties as soon as possible. Flipping a foreclosed property by the fix and flip method is considered as one of the best possible ways to earn a profitable income.
Is there any ways to prevent foreclosure? Yes of course. Mortgagors, who wish to retain their property, can adopt some strategic measures to avoid foreclosures. Issuing a forbearance notice will enable a mortgagor to delay his payments for a short while, if he proves that he is capable of repaying the loan. Loan modification is another process in which a mortgagor can enjoy some benefits including interest cuts, period extension, and reduction in capital amount. Other methods to avoid foreclosure include reinstatement, repayment plan, and short sale etc.
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Category Real Estate | Tags: Tags: Grace Period, Lenders, Lien Holder, Lien Holders,
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Friday, December 25th, 2009
Joshua Mintz asked:
src=”http://reoonlinetrainingprogram.com/wp-content/uploads/2009/07/seen-on2.jpg” alt=”names of banks that sell foreclosed homes” /> Profit From Bank Owned Foreclosures
Knowing the names of the banks that owned foreclosed homes probably is not the toughest part of making money from foreclsoed homes. Unless you are only trying to buy a foreclosed property for your own use – you will want to know who’s in charge of the forelosed properties -not where these properties are sold from.
Names of Banks That Sell Foreclosed Homes
Basically, mopst banks that make home loans, will own foreclosed homes. And if you are looking into buying and selling foreclosed homes, its very important to build relationships with your local banks and their asset managers, loan offiders and anyone else that can provide you with the important information – like the newest homes to hit foreclosure or the best homes i nforeclosure and things like this.
What most of the new agents we work with usually do, is buy there first list of foreclosed homes. See, if you can get a good list of these homes and properties, you wont get stuck running in circles just to get a couple of homes -homes that are either being looked at by tons of other agents or arent really viable. There will be a lot of competition when you are looking for the same foreclosed homes , in the same area, in the same way.
You need to find a way to get above the new agents. You should be able to make a better first impression on the banks and the lenders. They are used to seeing all kinds of first timers coming at them and asking for lists of bank owned foreclosures, and its hard for them to determine who’s who. But when you can start out with a real solid list of foreclsoed /bank owned homes, you give your self a great chance at skipping over the slow start that plagues so many agents at the beginning of there career. Unfortunately, most agents that fail to make any real money, often quit within a few months of starting.
And its safe to say its because they never even see one of those properties that are guaranteed to turn a real solid profit. And thats usually because they are struggling near the bottom, trying to get the same lists and hjomes that 100’s of other agents are also trying to get there hands on.
You can get a complete training program ,complete with lists and techniques for making good money in the foreclosure industry. Its the best possible way to learn what it takes to become a successful foreclosure specialist. We all know that right now is undoubtedly one of the absolute best times in the history of our country to deal in foreclsoed homes.
Foreclosurs are at all-time highs and the market prices are at all time lows.
Its the PERFECT storm -and you dont need to be a genius to take advantage. You just need to know how to do things the right way. And with the proper training materials and a good list of foreclosed homes and banks -you will have no problem sealing the deal on your first sale within a matter of weeks.
Check out the Foreclosure Lists and Other great material here:
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Category Real Estate | Tags: Tags: Career, First Timers, Foreclosed Property, Names,
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Friday, December 25th, 2009
Malik Ahmad Attorney at law asked:
Foreclosure in Nevada?
How, Whys, and Defense?
By
Malik W. Ahmad Attorney at Law
[Malik Ahmad is a licensed attorney and admitted to practice to the Supreme Court of Nevada. Malik Ahmad is a solo practitioner and has his own law office in Las Vegas Nevada. Malik Ahmad is admitted to practice in all the courts in State of Nevada. His areas of practice includes bankruptcy, civil and business litigation as well as foreclosure defenses in Nevada. WWW.fastbankruptcynevada.com www.mymaliklaw.com]
All loans in real estate property are considered secured loans. Whenever there is collateral attached to a loan, it is called secured loan. Unsecured loans are mostly credit cards loans and has no collateral attached with them. Here, in Nevada, and in the real estate context, all loans are secured because they are attached with property. When a loan secured by your lender goes into default, the secured creditor has a right to initiate foreclosure proceedings to take over this collateral. The lender has two choices: one is judicial foreclosure, and the other is non judicial or statutory foreclosure. Also, these days lenders are using other tactics like workout package, surrender deed in lieu of foreclosure, short sale, and of course the much touted loan modifications.
A foreclosure happens much after all these remedies or solutions are exhausted. Lenders does not like to lose money and like the homeowners wants to pursue all of the options at all the times. A workout package may or may not work because the lender is exploring all the choices where the homeowners can be made current. In a workout package, the lender sees your financial situation, the nature and value of your collateral and whether there are instant advantages which can be accomplished through the workout package. In almost all cases, sooner you talk to your lenders; they would suggest a workout package. The lender may send a workout package to you right away. There is a glimmer of hope for them to see their delinquent loan cured by your through this workout package. Also, it may follow a forbearance period. Just like borrowers, lenders are in a hurry to see a quick solution to this delinquency. Again, there is no uniform method of conducting such negotiation, each lender has their different guidelines and of course very skilled negotiator for this purpose.
A deed in lieu of foreclosure:
The borrower executes a deed where he conveys the property to the secured creditor in lieu of conducting the foreclosure sale. This way the lender becomes the owner of the property without going through the hassle of foreclosing and avoiding extra expenditure of publication. It is a voluntary matter from the borrower where no money in return can be expected. Sometime the borrower offers some money in exchange of clean returning the keys and up keeping the property during the transition times. This paper, however, only discusses situation after the workout package is exhausted or not discussed. There are some advantages of deed in lieu of foreclosure:
1. Quick negotiation process.
2. Borrower avoids negative publicity.
3. Less expensive for the lenders, does not pay for publication of notices.
4. No recordation of documents with the county or recorders office.
5. There is no public record of any kind created.
6. Borrower may obtain some legal as well financial concession from the lender.
7. May stay in the property for sometime without paying any mortgage payments.
8. The foreclosure process is lengthy and parties can avoid for some mutual benefits.
9. Lenders can do to avoid potential bankruptcy problems.
10. The borrower can negotiate the reporting of foreclosure to the credit reporting agencies. A foreclosure on a credit agency is extremely damaging, and the creditors may be approached to report such foreclosure in a more human and decent way.
11. The lenders can have an immediate possession of the property.
12. A deed in lieu of foreclosure does not eliminate junior encumbrances. The lender that takes a deed in lieu of foreclosure takes the title subject to those junior encumbrances. The lender takes over these encumbrances and therefore the rights of secondary lien holders.
13. The lenders who accepts this deed in lieu of foreclosure also loses the right to pursue a deficiency judgment against the borrowers or guarantors either as a matter of law or as a matter of contract. See Maloney v. Boston five Cents Savings Bank FSB, 422 Mass. 431, 436, 663 N.E. 2d 811, 815 (1996). Both parties should pay particular notice to the doctrine of merger.
14. Doctrine of Merger: When one party holds both a fee interest in property and lien on the same property, the lesser interest will merge into the greater interest. See Alladin Heating Corp. v. Trustee of the Central States Pension Plan, 93, Nev. 257 (1977) (holding that whether merger occurs is dependent upon the intent of the parties). If a merger occurs, junior liens increase in priority as a result of removal the senior lien held by the lender. If there are junior liens of the property, therefore, the lender may prefer that its higher priority lien remain of record after the conveyance by the deed in lieu.
15. Another pitfall is that if the borrower files a bankruptcy, this can be considered a collusive transaction. The bankruptcy code and state law allow a bankruptcy trustee to avoid certain transfers of property that are made prior to a bankruptcy filing known as “fraudulent transfers” 11 U.S.C. Section 548(a)(1)(B); NRS 112.180,., 190. A transfer of property through a deed in lieu of foreclosure is a voluntary transfer that is not subject to the “protections” of the foreclosure process. See Main v. Brim, 75 B.R. 322, 327 (Bankr. D.Az. 1987)
Foreclosure Process in General in Nevada:
Most of the loans are premised upon continuous payments to the lenders. If these payments are not timely paid, or not continuously paid, the borrowers can start the foreclosure process. The lender reviews the loan documents and determines about the occurrence of a default. Failure to make loan payments triggers this default process. Also, it is contingent upon events which have not been corrected by payments or failure of a workout package.
A trustee under a deed of trust may exercise its statutory power of sale without the judicial intervention. In Nevada, the foreclosure is mostly a statutory foreclosure. (NRS 107.080(1)). Judicial foreclosures are also permitted under Nevada law (NRS 40.430-40.450) but judicial foreclosures are not the preferred choice in Nevada for most of the lenders because of the looming danger of the right of redemption. Upon default, the initial step is for either the beneficiary or the trustee to execute a notice of breach and election to sell, which is usually accompanied by an unrecorded Declaration of Default. (NRS 107.080(2)(b)). The beneficiary executes the notice, but the trustee records it. The notice of breach and election to see must be recorded in the county in which the property encumbered by the trust deed is situated. This notice must also be mailed (notice of breach and election to sell) by registered or certified mail, return receipt requested with postage prepaid, to the address of the trustor and to the person who holds the title of record, if known, otherwise to the address of the property. (NRS 1076.080(3)
Notice of Default and Election to Sell?
1. Must describe the property
2. Must describe the deficiency in performance of payment.
3. May contain a notice of intent to accelerate the entire unpaid balance if the terms of the obligations so permit (NRS 107.080(3).
4. Within 10 days of recording and mailing the notice of default to the trustor, copies of the notice must also be sent by registered or certified mail, return receipt requested, to each person who has either (1) filed a request for a copy of the notice; or (2) holds a record interest in the property subordinate to the deed of trust being foreclosed. Additionally, 20 or more days before the sale, the trustee must mail a copy of the notice of the time and place of the sale to the same parties by register3ed or certified mail, return receipt requested. (NRS 107.090.)
5. Nevada laws make it immaterial whether the notice is actually received by the trustor. The notice is effective nonetheless. (Turner v. Dewco Services, Inc., 87 Nev. 14, 479 P. Wd 462 (1971)
6. NRS 107.080(2)(a) provides that no power of sale may be exercised unless the trustor or his successor in interest, a beneficiary under a subordinate deed of trust or any other person with a subordinate lien or encumbrance of record (referred to below as “trustor or interested person”) has, for a period of 35 days, “failed to make good the deficiency in performance or payment….” The 35-day period commences on the first day following the day upon which the notice and election is recorded and mailed to the grantor and to the record owner of the property in the manner specified above. (NRS 108.080(3). If the trustor other interested persons “make good” the deficiency in payment or performance within the 35-day period, the trustee’s power of sale may not be exercised, and the obligation may not be accelerated. NRS 107.080(2)(a), (3). The 35-day period in the statute exists independently of any notice or cure periods contained the applicable notes or deeds of trust. If the notice of breach contains a permitted election to accelerate and the breach is not cured within the 35-day period, the trustor or other interested persons can thereafter only prevent the sale by tendering the entire unpaid balance of the obligation, as well as any costs, fees and expenses incidents to the preparation or recordation of the notice and incident to the making good of the deficiency in performance or payment (NRS 107.080(3).
What is the Procedure for Trustee’s Sale?
When three months have elapsed from the date of the recordation of the notice of breach and election to sell, the trustee may give notice of the time and place of the trustee’s sale, which notice must be given in accordance with the statutory provisions for execution sales of real property – posted notice in three public places for 20 successive days and published once a week for three consecutive weeks. (NRS 107.080(4);231.130(1)©. The trustee’s sale may be held at the office of the trustee anywhere in Nevada, even if it is not in the county where the property being sold is located. (NRS 107.080(4).
If the power of sale is exercised in compliance with the Nevada statute, the purchaser is vested with the title of the trustor, without equity or right of redemption NRS 107.080(5).
What are the Guarantor’s Rights to Notice and Subrogation?
The notice of breach and election to sell must be mailed by certified mail, postage prepaid, to each guarantor or surety of the debt at the address of each if known, or at the address of the trust property. The notice must also be mailed to any other obligor who has filed a request for a copy of the notice under NRS107.090. Failure to provide such notice would release that guarantor, surety or obligor from liability on the obligation. (NRS 107.095(1).
Under NRs 107.095(3) a guaranty, surety or other obligor is not released if the required notice is give at least fifteen (15) days before the later of the expiration of the 35-day period described in NRs 107.080 or any extension of that period by the beneficiary, or if the notice of default is rescinded before the sale id advertised.
Upon full satisfaction by the guarantor, surety or other obligor, other than the trustor, of the indebtedness secured by a mortgage or lien, the paying guarantor or obligor is entitled to enforce every remedy which the beneficiary has against the trustor, and is entitled to an assignment from the beneficiary of all of the rights the beneficiary then has by way of security for the payment or performance of the trustor. NRS 40-475 (1989). Such an obligor is also entitled to subrogation, junior only to the secured lender’s rights, in the case of partial satisfaction of the indebtedness. (NRS 40.485 (1989). These rights may only be waived by the guarantor, surety or other obligor after default. NRs 40.495(1)(1989).
What are the rights under One Action Rule?
In Nevada, a deficiency judgment can be filed under non statutory foreclosure provisions without having filed a judicial foreclosure.
What is a deed of Trust in Nevada?
The most common type of security interest in real property in Nevada is a Deed of Trust. A DOT has three parties.
Lender: It is the first party who is referred to as “Beneficiary.”
Borrower: It is the second party who is referred to as the “Maker”, or “Grantor”, or ”Trustor” who conveys legal title to the property to the Trustee.
Trustee: This is the third party who holds legal title to the property.
Process: A DOT can be foreclosed in a simple process and cheaper as well. A Trustee sells the property encumbered by the DOT. All the lender needs to do in order to foreclose on a DOT is to determine that an even of default has occurred under the DOT and have the trustee conduct non-judicial foreclosure proceedings. Here, in Nevada, the trustee sale does not entail redemption. The borrower, in Nevada, does not have the statutory rights of redemption unlike the judicial foreclosure where the right of redemption lasts one year. Compare NRs 107.080(5) (no right of redemption in a foreclosure on a DOT ) with NRs 21.210 (one year period of redemption).
Determination of Default.
Your default notice also consists of a determination of default. It can be monetary or non monetary. Monetary is when it is linked to borrowers failure to pay, failure to pay property taxes, failure to pay homeowners association assessments and failure to pay special improvements and other assessments against the property. The non monetary events of default are spelled out in the notice of default and Deed of Trust as well as related loan documents. They can be failure to insure property, the failure to maintain debt service coverage ratios and waste.
Acceleration of Obligation:
A trustee under a deed of trust may exercise its statutory power of sale (commencement of foreclosure process) without judicial intervention in Nevada. NRs 107.080(1). Judicial foreclosure is also permitted under Nevada laws though seldom exercised. (NRs 40.430-40-450). They carry with them a one year right of redemption which lenders does not like it as they like to close this chapter once for all.
Steps in Foreclosure In Nevada:
1. The beneficiary or the trustee to execute a notice of breach and election to sell which is usually accompanied by an unrecorded Declaration of Default. (NRS 107.080(2)(b). The beneficiary executes the notice, but the trustee records it. The notice of breach and election to sell must be recorded in the county in which the property encumbered by the trust deed is situated. The notice of breach and election to sell must also be mailed by registered or certified mail, return receipt requested with postage prepaid, to the address of the trustor and to the person who holds the title of record, if known, otherwise to the address of the property. (NRS 1076.080(3).
2. The notice and election must describe the deficiency in performance or payment, and may contain a notice of intent to accelerate the entire unpaid balance if the terms of the obligation so permit. (NRS 107.080(3).
3. Within ten days of recording and mailing to the trustor the notice of default, copies of the notice must also be sent by registered or certified mail, return receipt requested, to each person who had either (1) filed a request for a copy of the notice; or (2) holds a record interest in the property subordinate to the deed of trust being foreclosed. Additionally, 20 or more days before the sale, the trustee must mail a copy of the notice of the time and place of the sale to the same parties by registered or certified mail, return receipt requested. (NRS 107.90)
4. Under Nevada law, it is immaterial whether the notice is actually received by the trustor. Turner v. Dewco Services, Inc., 87 Nev 14. 479 P.2d 462 (1971).
5. NRS 107.080(2)(a) provides that no power of sale may be exercised unless the trustor or his successor in interest, a beneficiary under a subordinate deed of trust or any other person with a subordinate lien or encumbrance of record (trustor or interested persons) has, for a period of 35 days, “failed to make good the deficiency in performance or payment….” The 35-day period commences on the first day following the day upon which the notice and election is recorded and mailed to the grantor and to the record owner of the property in the manner specified above. NRS 107.080(3). If the trustor or other interested person “make good” the deficiency in payment or performance within 35-day period, the trustee’s power of sale may not be exercised, and the obligation may not be accelerated. NRs 107.80(2)(a), (3). The 35-day period in the statue exists independently of any notice or cure periods contained in the applicable notes or deeds of trust. If the notice of breach contains a permitted election to accelerate and the breach is not cured within the 35-day period, the trustor or other interested persons can thereafter only prevent the sale by tendering the entire unpaid balance of the obligation, as well as any costs, fees and expenses incident to the preparation or recordation of the notice and incident to the making good of the deficiency in performance or payment. NRS 107.080(3).
6. Nevada Revised Statutes Chapter 107 governs Deeds of Trusts. The transfer of real property may be made in trust to secure loans and other obligations. See NRs 107.020. In the event a transfer is made in trust to secure payment, the Trustee is granted a power of sale which may be exercised if an event of default has occurred. See generally NRS 107.080.
How a Foreclosure Process in Nevada is Commenced?
1. The lender must first determine that an event of default has taken place.
2. The lender employs the Trustee or a successor.
3. The Trustee will prepare and record in the Office of the County of Records of the County in which the property is located a Notice of Default and Election To Sell. (NRS 107.080).
4. The Notice of Default and Election to Sell must be mailed by registered or certified mail, return receipt requested Election to Sell must be mailed by registered or certified mail, return receipt requested and postage prepaid, to the grantor of the Deed of Trust, the person who holds title of record on the date of the Notice of Default and Election to Sell, each guarantor or surety of the debt, NRS 107.095(1), and any person who recorded a request for a Notice of Default and Election to Sell. (NRS 107.090.
5. On the first day after the Notice of Default and Election to Sell is recorded and sent by mail to all interested parties, the borrower and the other obligors are then given 35 days to make good the deficiency in payment or performance. NRs 107.080(2)(a)(2). This essentially allows the borrower or other obligors to de-accelerate the default under the Deed of Trust and terminate the foreclosure proceedings.
6. In the event the borrower or other party in interest fails to cure the deficiency in payment or performance, the Trustee must wait until the expiration of three months following the recording of the Notice of Default and Election to Sell (55 days after the 35 day reinstatement period expires) before giving notice of the time and the place for the sale of the real property (NRS 107.080). The notice of the time and place for the sale of the real property must be published in accordance with Nevada’s execution statutes.
Requirements of Publication for the Notice Under Nevada Laws
Nevada statute requires the following publication of the notice of the date, time and place of the sale:
(1) Personal service or service by registered mail to the last known address of each person entitled to Notice of Default and Election to Sell;
(2) The posting of a similar notice particularly describing the property , for twenty days successively, in three public places of the township or city where the property is situated in or where the property is to be sold; and
(3) Publishing a copy of the Notice three times, once each week for three successive weeks, in a newspaper, if there is one the county. (NRS 21.130(c).
(4) In addition to the notice required by Nevada’s execution statutes, the Trustee is required to, at least twenty days before the date of the sale, deposit in the United States mail and envelope, registered or certified, return receipt requested and with postage prepaid, containing a copy of the Notice of time and place of sale, addressed to each person who has recorded a Request for Notice of Default and Sale. See NRS 107.090(4).
(5) If the Trustee fails to give any person liable to the beneficiary or any other person who has requested a Notice of Default and Sale the required notices, that person may be released of its obligation to the lender. NRs 107.095.
(6) NRs 107.080(4) allows the Trustee to conduct the sale at the Trustee’s office.
(7) At the foreclosure sale, the Trustee may sell the real property by public auction. Generally, the lender will provide the trustee with a minimum credit bid before the foreclosure sale. The amount of the credit bid may be for the full amount of the debt owed to the beneficiary or only a portion of what is owed to the beneficiary. Any person or entity may attend the foreclosure sale and bid for the real property.
What is Nevada’s “One Action Rule”?
Nevada has adopted a one-action rule. It provides that there may be only one action to collect a debt secured by a mortgage or other lien. The Nevada One Action rules provides: (NRs 40.430(1)-(3).
1. There may be but one action for the recovery of any debt, or for the enforcement of any right secured by a mortgage or other lien upon real estate. That action must be in accordance with the provision of this section and NRS 40.433 to 40.459, inclusive. In that action, the judgment must be rendered for the amount found due the plaintiff, and the court, by its decree or judgment, may direct a sale or the encumbered property, or such part thereof as is necessary, and apply the proceeds of the sale as provided in NRs 40.462.
2. This section must be construed to permit a secured creditor to realize upon the collateral for a debt or other obligation agreed upon by the debtor and creditor when the debt or other obligation was incurred.
3. A sale directed by the court pursuant to subsection 1 must be conducted in the same manner as the sale of real property upon execution, by the sheriff of the county in which the encumbered land is situated, and if the encumbered land is situated in two or more counties, the court shall direct the sheriff of one of the counties to conduct the sale with like proceedings and effect as if the whole of the encumbered land were situated in that county.
Conclusion: The Foreclosure–The End of the Dream:
The foreclosure is the final and definitive step and the end of the whole nightmare process. There is no right of redemption for a non judicial foreclosure in Nevada. The acceptance of the winning bid concludes the bidding process. The execution sale is final and deprives the debtor of any entitlement to the rights of ownership in the property. It is final elimination of any liens on the property along with the junior encumbrances.
What is right of Redemption?
Few words on redemption: The foreclosure process may not be final unless a final remedy can be exercise in Nevada, and that is called right of redemption. There is no redemption in non judicial foreclosures. However, there is one year period of redemption in a judicial foreclosure sale in Nevada. Right of redemption is paying off all the existing monetary obligations up to and before the final fall of the hammer. The full amount may consist of all delinquent amounts, plus interest and attorney fees and other publication costs. Under Nevada law, there are no rights of redemption in connection with a properly conducted non-judicial foreclosure sale. NRS 107.080(5). There is one year right of redemption in a judicial foreclosure sale (NRS 21.210)
What is Deficiency Judgment, and Where This Money Will Come From?
As it is happening quite often these days, the Trustee will sell property at a foreclosure sale for less than the amount which is owed to the creditor or beneficiary under the Deed of Trust. Deficiency judgments are governed by NRs 40.451 to 40.459. The beneficiary must file the deficiency action within six (6) months after the date of the foreclosure sale or the deficiency action will be time barred. Specifically, NRs 40.455(1) provides:
Upon application of the judgment creditor or the beneficiary of the deed of trust within six months after the date of the foreclosure sale or the Trustee’s sale held pursuant to NRs 107.080, respectively, and after the required hearing, the court shall award a deficiency judgment to the judgment creditor or beneficiary of the deed of trust if it appears from the sheriff’s return or the recital of consideration and the trustee’s deed that there is a deficiency of the proceeds of the sale and a balance remaining due to the judgment creditor or the beneficiary of the deed of trust, respectively. NRS 40.455(1)
Nevada law places stringent limitations on the amount of a money judgment, which may be recovered against the debtor, guarantor or surety who is personally liable for the deficiency. The court shall not render a deficiency judgment for more than:
1. The amount by which the amount of the indebtedness which was secured exceeds the fair market value of the property sold at the time of the sale, with interest from the date of the sale; or
2. The amount which is the difference between the amounts for which the property was actually sold and the amount of the indebtedness which was secured, with interest from the date of sale, whichever is the lessor amount.
3. The court may also consider expert appraisal testimony to evaluate the fair value of the property.
4. The junior lien holder if their rights are not properly extinguished can also sue for deficiency judgment.
5. Nevada law provides that the anti deficiency legislation protects a guarantor and any other entity that is personally liable for the debt. See generally NRS 40.459.
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Thursday, December 24th, 2009
Jeremiah asked:
One of the best real estate investments that you can possibly make is buying bank foreclosed homes. If you’re looking to buy a home for your family or simply for investment purposes, then a repossessed home or bank owned foreclosures home is the ideal choice for you.
Why buying foreclosed homes is a good investment?
When you are purchasing bank foreclosed homes, you have already managed to make a significant amount of money on the property. As you are paying a property price that is about 10% to 50% below the market value, the moment you close the deal, the property has equity.
Are all such homes bank foreclosure homes?
Foreclosure homes are basically categorized into two types – pre-foreclosures that come from the public notice filing to evict and Real Estate Owned or REO, which are homes possessed by banks and vacant to move in after the purchase.
For real estate investors or first time homeowners, the safest, easiest and convenient method of property acquisition is Real Estate Owned properties. This is because compared to any other form of property purchase; there are no issues of property title attached to the property.
Buying bank foreclosure homes means no hassles!
When you are buying foreclosed properties owned by banks or bank foreclosure homes, you get the property title policy without any exceptions. Additionally, there are no back taxes to be paid, as the banks have paid everything at the closing and the house is vacant for you to move in at your own convenience.
If you are considering buying a home, bank foreclosed homes is the perfect choice to have your dream home and save a huge amount of money. For a free list of bank owned foreclosures, please feel free to browse through bank foreclosure homes or contact us.
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Category Real Estate | Tags: Tags: Buying A Home, Exceptions, Investment Purposes, Real Estate Owned Properties,
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