real estate finance - full book (500 pgs)

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Unformatted text preview: REAL ESTATE FINANCE NOTICE OF SALE The trustee publishes a “notice of sale” once a week for 20 days and posts notice on property. In addition, the notice of sale must be recorded in the county where the property is located at least 14 days prior to the sale. Sale date is usually 22 or 23 days after notice. The notice must include a description of the property or, if none is available, the name and address of the beneficiary. The trustor may still pay off the full loan and penalties prior to the sale; no redemption right exists after the sale. TRUSTEE'S AUCTION The trustee sells to the highest bidder, pays expenses and lien(s), and issues a trustee's deed. Title is cleared of all junior liens except possible mechanics liens or real estate tax liens. No deficiency judgment is allowed following a trustee's sale. However, a foreclosing beneficiary at a trustee's sale may later sue for damages and pursue postsale claims against the trustor for bad faith waste and fraud. To do so the beneficiary must have made a credit bid at the trustee's auction that was less than the amount of the secured debt and foreclosure costs. FORECLOSURE TIME The foreclosure process under a trust deed is relatively speedy compared to the court proceedings under a mortgage. “Notice of default” – 3 months minimum plus additional time which may be granted. “Notice of sale” –20 days. 8-14 Licensing School for Appraisal, CPA, Contractors, Insurance, Real Estate, Notary, Nurse, Food Handlers, Tax and Securities 8: FINANCING INSTRUMENTS Total time to accomplish foreclosure – approximately 4 months. TRUSTOR’S RIGHT OF REINSTATEMENT A debt under a trust deed can be reinstated by a trustor if payment of the overdue amount is made at any time after the notice of default is recorded, but no later than five (5) business days prior to the date of sale in the subsequent recorded notice of sale. Reinstatement within the five-day period preceding the sale would be at the discretion of the beneficiary and might still be allowed. Figure 8-1 Trustee’s...
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This note was uploaded on 12/30/2010 for the course SOC 101 taught by Professor Zhung during the Spring '10 term at Punjab Engineering College.

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