Voluntary Liens and Foreclosures 17 Flashcards Preview

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Flashcards in Voluntary Liens and Foreclosures 17 Deck (72)
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1

Failure to Comply with Any Terms of the Note or Mortgage

Default -

Failure to Comply with Any Terms of the Note or Mortgage

Chap 17

2

A Pledge of Real Property as Security Without Giving Possession of Property to Lender.

Hypothecation -

A Pledge of Real Property as Security Without Giving Possession of Property to Lender.

Note: Promissory Note (Chap 6) - Personal Promise to repay a debt. Serves as evidence of debt, but does not reference collateral. 

Chap 17

3

Secures Note with Collateral (Property), Document is called?

  1. Promissory Note - Promise to Repay Debt (Amount, Rate, Pattern of Pymts - No Collateral Referenced)
  2. M_____or - Borrower / M_____gee - Lender
  3. S______ Of Mo______ - Pay-Off

Remember OR Gives and EE receives

Mortgages - Secured Note With Collateral (Property)

  1. Promissory Note - Promise to Repay Debt (Amount, Rate, Pattern of Pymts - No Collateral Referenced)
  2. Mortgagor - Borrower / Mortgagee - Lender
  3. Satisfaction Of Mortgage - Pay-Off

Remember OR Gives and EE receives - Mortgagor gives money to Mortgagee.

 

Chap 17

4

Mortgage Default Steps (Judicial Foreclosure)

  1. E___ of R______ - Borrower holds
  2. L__ P______ (Lawsuit)  - Recorded
  3. C____ Ac___ - Takes Place
  4. S____'s S_____ - Highest Bidder Received S____'s C____ of Sale
  5. Stat____ Ri___ of Redem____ - For __ months begins
  6. If N_ R______ - S_____'s Deed Issued to Bidder

Mortgage Default Steps (Judicial Foreclosure)

  1. Equity of Redemption - Borrower holds
  2. Lis Pendens (Lawsuit) - recorded
  3. Court Action - takes place
  4. Sheriff's Sale - Highest Bidder received Sheriff's Certificate of Sale
  5. Statutory Right of Redemption - For 6 mos begins
  6. No Redemption - Sheriff's Deed Issued to Bidder

Chap 17

5

Promise to Repay Debt - with Amount, Rate, Pattern of Payments Noted - and (No Collateral Referenced) is called?

  1. Mortgage - Secures note with Collateral/Property
  2. Mortgagor - Borrower / Mortgagee - Lender

Promissory Note - Promise to Repay Debt - with Amount, Rate, Pattern of Payments Noted - and (No Collateral Referenced)

  1. Mortgage - Secures Note with Collateral/Property
  2. Mortgagor - Borrower / Mortgagee - Lender

Chap 17

6

Payoff of Mortgage - Lender Delivers in 30 days to Borrower This document is called?

Defeasance (Payoff) or Satisfaction of Mortgage -

Lender Delivers in 30 days to Borrower as Proof of Payment in Full.

Chap 17

 

7

Lawsuit Filed, and Recorded and the Debt is Accelerated.  This Document States that Litigation is Pending Against the Property Owners. Used in Mortgage Process.

Lis Pendens -

Lawsuit Filed, and Recorded and the Debt is Accelerated.  This Document States that Litigation is Pending Against the Property Owners. Used in Mortgage Process.

Chap 17

8

In Mortgage Defaults -

How Does Borrower Hold Title before the Sheriff's Sale

In Mortgage Defaults -

Equity of Redemption - Borrower Holds this Title before the Sheriff's Sale

Chap 17

 

9

In a Mortgage Default, When does Sheriff's Sale Take Place?

Mortgage Default

Sheriff's Sale - takes place After Lis Penden's Filed, and Court Action Takes Place.

Then Sheriff's Sale is Conducted, then Statutory Right of Redemption starts (6 Mos).

Chap 17

10

Mortgage in Default Process -

  1. L_ P______ - Lawsuit Filed and Recorded.  The Debt is Accelerated.  L__ P_____ States Litigation is Pending Against Property Owners.
  2. C____ Ac____ - Takes Place
  3. Sh___ S____ - Highest Bidder Gets S______ Cert_____ of S___
  4. Stat_____ R____ of Red_____ ___ Months Given to Owner
  5. S_____'s D____ - If no Redemption - Sherrif's Certificate of Sale Holder Gets Full Title.

Mortgage in Default Process -

  1. Lis Pendens - Lawsuit Filed and Recorded.  The Debt is Accelerated.  Lis Pendens States Litigation is Pending Against Property Owners..
  2. Court Action - Takes Place
  3. Sheriff's Sale - Highest Bidder gets Sheriffs Certicate of Sale
  4. Statutory Right of Redemption 6 Months Given to Owner
  5. Sheriff's Deed - If no Redemption - Sherrif's Certificate of Sale Holder Gets Full Title.

Chap 17

11

Mortgage Defaults -

At the Sheriff's Sale what does the Highest Bidder receive and what happens next?

Mortgage Defaults -

Sheriff's Certificate of Sale -

At Sheriff's Sale the  Highest Bidder receives "Sheriff's Cert of Sale."  Next, Statutory Right of Redemption - follows for 6 months.

Note to Self: Mortgages - 6 mos to reinstate after sale / Trust Deeds - 90 days to reinstatte.before sale

Chap 17

 

12

In Mortgage Default

After the Sheriff's Certificate of Sale is Given to Highest Bidder.  What happens next?

 

Statutory Right of Redemption (Mortgages Defaults) -

The Owner is Given (6 months) to Reinstate.    After Sheriff's Sale Certificate of Sale (Given to Highest Bidder)

Chap 17

 

13

Mortgage Sheriff's Sale - Biddng

  1. Ex___ M___ Bid - Excess funds belong to borrower (minus foreclosure cost)
  2. N_ B___ - Lender bids and receives C_____ of S_____
  3. Insu_______ M____ B___ -- Deficiency Judgment is obtained by lender when sale brings less than amt owed.

Mortgage Sheriff's Sale - Bidding

  1. Excess Money Bid - Excess funds belong to borrower (minus foreclosure cost)
  2. No Bids - Lender bids and receives Certificate of Sale
  3. Insufficient Money Bid -- Deficiency Judgment is obtained by the lender when sale brings less than amt owed.

Remember:  Arizona law prohibits (Deficiency Judgment) on 2.5 acres or less or used as sfr)

Chap 17

14

Trust Deed Documents -

1. Promissory Note - Promise to R____ Debt (Amount, Rate, Pattern of Payments - No Collateral Reference)

2. Trust Deed - Secures Note with C______/P______

3. Trustor/Borrower; Beneficiary/Lender; Trustee/3rd Party with power to sell

4. Trustee Acts by Ben______ Instructions, and Only when Trust Deed is Paid-Off or in Default.

5. Defeasance (Pay-off) - D_____ of Rec______ Releases you from Deed of Trust; Beneficiary/Lender instructs Trustee to send - In 30 days of payoff.

Trust Deed Documents -

  1. Promissory Note - Promise to Repay Debt (Amount, Rate, Pattern of Payments - No Collateral Reference)

    2. Trust Deed - Secures Note with Collateral/Property

    3. Trustor/Borrower; Beneficiary/Lender; Trustee/3rd Party with power to sell

    4. Trustee acts by Beneficiary instructions, and only when Trust Deed is paid-off or in default.

    5. Defeasance (Pay-off) - Deed of Reconveyance releases you from Deed of Trust; Beneficiary lender instructs Trustee to send - 30 days of payoff.

Chap 17

15

Non-Judicial (Trustee's Power of Sale)

  1. Tr___ Instructed to S___ - Per Benificiary-Lender
  2. Not__ of Def___ and Tru__ S___ - Recorded by Trustee (County Recorder Office)
  3. N___ to Tr___/Borrower: Trustee sends "Notice of Default and Trustee Sale" to Tr____ and Anyone Who Recorded "Request for Notice of Default.
  4. R____ of Rein________ - Trustor/Borrower May Cure Default by Paying Back Balance Due and (Cost/Penalties) at Anytime Before Sale in (___ Days)
  5. Tr_____ Sale held - After 90 days Right of Reinstatement Period. Sale held and T____ Deed - to Highest Bidder.
  6. Tr____  D_____ - Given to Highest Bidder.

Def_____ J_______ prohibited - 2 1/2 acres or less (SFR/2Units)-

Trust Deed in Default (Non Judicial Foreclosure)

Non-Judicial (Trustee's Power of Sale)

  1. Trustee Instructed to Sell - Per Benificiary-Lender
  2. Notice of Default and Trustee Sale - Recorded by Trustee (County Recorder Office)
  3. Notice to Trustor/Borrower: Trustee sends "Notice of Default and Trustee Sale" to Trustor and Anyone who Recorded "Request for Notice of Default.
  4. Right of Reinstatement - Trustor/Borrower May Cure Default by Payng Back Balance Due and (Cost/Penalties) at Anytime Before Sale in (90 Days)
  5. Trustee Sale held - After 90 days Right of Reinstatement Period. Sale held and Trustee Deed - to Highest Bidder.
  6. Trustee Deed - Given to Highest Bidder

Deficiency Judgement prohibited - 2 1/2 acres or less (SFR/2Units)

Chap 17

16

Agreement for Sale is also know as?

1) Contract for S___ of R___ Es____; 2) L___ Con____; 3) C_____ for D____; 4) V_____'s L____

Entails the following:

1) A Contract for Sale of Property and Financing Instrument - All In One2) Deed is Not Delivered at Closing as With a Mortgage/Trust Deed. 3) At Closing Buyer Should "Record" Contract to Show "Equitable Title." 4) Seller usually Delivers Deed to Buyer After Final Payment.

Agreement for Sale also known as:

1) Contract for Sale of Real Estate; 2) Land Contract; 3) Contract for Deed; 4) Vendor's Lien

This type of contract entails the following:

1) A Contract for Sale of Property and Financing Instrument - All In One2) Deed is Not Delivered at Closing as With a Mortgage/Trust Deed. 3) At Closing Buyer Should "Record" Contract to Show "Equitable Title." 4) Seller usually Delivers Deed to Buyer After Final Payment.

Chap 17

17

What is 1st step in Trustee's Power of Sale?

Trustee's Power of Sale - 1st Step

  1. Trustee Instructed to Sell - Beneficiary-Lender instructs trustee (3rd party) to sell. (Step 1)

Chap 17

18

What does the Trustee do After Instructed to Proceed with Trustee's Sale?

N___ of D____ and Tr____ Sale is Re______

Trutee's Power of Sale (Step 2)

Notice of Default and Trustee Sale -

Is Recorded by Trustee with County Recorder Office (Step #2)

Chap 17

19

In a Trustee Sale - what is done with Notice of Default and Trustee Sale document?

Trustee's Power of Sale - (Step 3)

Notice to Trustor/Borrower:

Trustee Records then Sends - Notice of Default/Default Trustee Sale to trustor and anyone who has recorded "Request for Notice of Default. (step 3)

Chap 17

20

In a Trustee's Sale process, What Do Owners have Before the Sale and for What Time Frame?

Trustee's Power of Sale - (Step 4)

Right of Reinstatement (90 Days) - Given to Trustor/Borrower, Who May Cure Default by Paying Balance Due plus (Cost/Penalties) at Anytime Before Sale in 90 days (step 4).

After Notice of Default & Trustee Sale sent out....

Chap 17

21

In a Trustee Sale process, what happens after 90 days of Right of Reinstatement period?

Trustee's Power of Sale - (Step 5)

  1. Trustee Sale held - After 90 Days Right of Reinstatement Period, Trustee Deed - Given to Highest Bidder. (Step 5)

Deficiency Judgement prohibited - 2 1/2 acres or less (SFR/2Units)

Chap 17

22

In the Trustee Sale process, What is Given to Highest Bidder at the Trutee's Sale (at the Final Step of Process)?

Trustee's Power of Sale - (Step 6)

  1. Trustee Deed - given to Highest Bidder after 90 days Redemption Period at Trustee's Sale (step 6)

Deficiency Judgement prohibited - 2 1/2 acres or less (SFR/2Units)

Chap 17

23

Agmt for S___ aka C___ for S___ of R__ Es___, aka L___ C____, C____ for D___, and V_____ Lien

  1. Agreement used as S___ Fin______ (contract/financing all in one)
  2. Vend__/Seller and Vend__/Buyer
  3. At Closing: Buyer records contract to show ownership with no deed (Eq___ Ownership)

Remember Or Gives and EE receives

Agreement for Sale (Contract for Sale of Real Estate, Land Contract, Contract for Deed, and Vendor's Lien)

  1. Agreement used as Seller Financing (contract financing all in one)
  2. Vendor/Seller and Vendee/Buyer
  3. At Closing: Buyer records contract to show ownership with no deed (Equitable Ownership)

Remember Or Gives and EE receives - Vendor gives financing to Vendee (Buyer)

Chap 17

24

A Sheriff's Sale is held for what Type of Foreclosure?

Mortgages (Judicial Foreclosure) -

A Sheriff's Sale is held for Mortgages, After Court Action. "Sheriff's Certicated of Sale" Given to Highest Bidder. Then, Statutory Right of Redemption is Held for 6 Months by Mortgagor(Borrower).

Chap 17

25

What is Given to Highest Bidder in Sheriff's Sale

Sheriff's Certificate of Sale - is Given to Highest Bidder.

Statutory Right of Reemption- Begins for 6 months After Sheriff's Certificate of Sale issued at Sheriff's Sale. Then Sheriff's Deed conveys full title.

Chap 17

26

After a Mortgage is Paid-Off, What is Issued in 30 Days by Lender?

Satisfaction of Mortgage (Defesance/Pay-off) -

For Mortgages: Lender Delivers in 30 Days of Pay-Off to Borrower.

Chap 17

27

Mortgages have a Judicial or Non-Judicial Foreclosure?

Mortgages have Judicial Foreclosure -

  1. Equity of Redemtion - Held by Borrower
  2. Lawsuit (Lis Pendens) - Recorded States Pending Litigation.
  3. Court Action - Approval
  4. Sheriff's Sale - Sheriff's Cert of Sale (Highest Bidder),
  5. Statutory Redemption (6 mos) - for Borrower
  6. Sheriff's Deed - Not Redeemed Given to Holder of Sheriff's Cert of Sale.

Chap 17

28

In Trust Deeds, who are the Trustor, Beneficiary, and Trustee.

Trust Deeds (Parties) -

  1. Trustor/Borrower
  2. Beneficiary/Lender
  3. Trustee/3rd Party

Chap 17

29

Trust Deed - For Defeasance (Pay-off) What Document Used For This Type of Pay-Off to be Sent to Trustor?

Deed of Reconveyance -

Beneficiary(Lender) Instructs Trustee to Process In 30 Days of Payoff to Trustor (Borrower).

Chap 17

30

Is a Trust Deed Foreclosure Judicial or Non-Judicial?

Trust Deed Foreclosure - (Non-Judicial) both options avail.

  1. Lender Instructs - Trustee to Sell.
  2. Trustee Records - Notice of Default and Trustee Sale
  3. Trustee Sends Notice to Borrower/2nd Lien Holder
  4. Right of Reinstatement - Owner Bring Current Plus Cost/Penalties (90 Days - From Recording Notice of Default)
  5. Trustee Sale - Trustee's Deed delivered

Deficiency Judgements - prohibited (SFR/2 Units) or  2 1/2 acres or less.

Chap 17