Forclosure On Wrong Legal Description
Interesting delimma here. My friend (for real) is being forclosed on in early Dec. Missed payments since July. Legal description on mortgage is house/5acres. Friend owns back 15 acres outright and has since way before refinanced 5 acres and house. Friend quit-claim deeded the 15 acres to daughter in July. Error made by county clerk mistakenly recorded daughter owning house and and 5 acres also. Error found out by friend, asked for correction. Error again, this time gave house and all acres back to friend. Once again error corrected and letter sent to friend from county clerk's office. Now forclosure notice is in friend's name, jane doe', john doe, daughter's name also and is for entire amount of land and house (20 acres and house) even though the mortgage and appraisal were only for house and 5 acres. Notice makes mention of advertising 4 different times in local area paper (paper comes out only 1 time a week so impossible to get 4 times in by Dec date). How does she fix this mess? The deed they hold is only for the 5 acres and house. She quit-claimed over the 15 to daughter to avoid hospital taking land for hubby's heart attack.. another story in itself. :-(
Yes we do have a dilemma but the foreclosure action is based upon the security instrument i.e. the mortgage document.
The foreclosure publishing can be placed in public view such as a newspaper, a legal publication and or even an Internet site such as the law firm handling the case or on the sheriff's web site for said county.
I have stopped many foreclosures due to advertising/posting errors and title recording errors. At this point I would suggest your friend/customer contact a foreclosure attorney that specializes in consumer law and they may be able to stop this proceeding dead in its tracks.
Good luck on this one.
[addsig]
Further complication has arisen. She now found out that although the appraisal and papers were for the 5 acres and home; the legal description in the mortagage document was for the home/5 acres and in addition, the entire 15 acres she already owned outright. Now the forclosure is for all of it; which means that the mobile home her parents live in on the back 15 acres will have to be moved off?? Neither family has the $$ to move the mobile home. She is seeing an attorney today. What a mess, this is an interesting lesson for anyone signing papers; READ your legal description. My heart goes out to her.
Living in an area where there are a lot
of mobiles on lots we see this too.
Often the land is being foreclosed but
not the mobile.
Does anyone know what the rights of the
high bidder at the trustee sale would
be here in CA?
Bukzin
California is famous for its one-action rule, in which a lender must carefully elect one action to take against the borrower if the borrower defaults. If the lender forecloses the deed of trust out of court, the lender has chosen one action and may not bring a lawsuit to recover a deficiency, which would be a second action.
If the lender chooses to sue the borrower and obtain both a foreclosure order, and if the proceeds of the judicial sale of the real estate are not sufficient to repay the loan balance, then a deficiency for the balance. Such a suit is permitted as the lender’s one action.
California lenders rarely elect judicial foreclosures.
Preliminary Notice: Non-judicial
Notice of Sale
The notice of sale must contain the name, street address and phone number of the trustee conducting the sale and the original trustor, along with a statement warning borrowers that their property is about to be lost at a public foreclosure sale and to contact a lawyer for an explanation.
The notice must give the street address. If no street address exists, the notice must state the address of the beneficiary from whom a set of directions to the property may be obtained I they are requested in writing within ten days from the first publications of the foreclosure notice.
Advertising
A copy of the notice of sale must be posted in a conspicuous place on the property to be sold at least 20 days before the sale. If access to the property is restricted by means of a central guard gate, then the notice must be posted on the guard gate. A copy of the notice must be posted at one public place in the city where the property is to be sold (or judicial district in rural areas) at least 20 days before the sale.
Recording
A notice of trustee sale must be recorded at least 14 days before the sale.
Mailing
A notice of trustee sale must be mailed by certified mail, return receipt requested, 20 days before the foreclosure sale to the borrower, to anyone who requests notice or recorded a request and to the trustors, beneficiaries or parties at interest.
Sale Procedures: Non-judicial
Time
All sales under a power of sale in a deed o f trust will be made between the hours of 9:00 a.m. and 5:00 p.m. on any business day, Monday through Friday, at the time specified in the notice of trustee sale.
Place
The sale shall commence at the location specified in the notice of sale.
Manner
The sale must be made a public auction to the highest bidder. The trustee has the right to require every bidder to show evidence of ability to pay the full bid in cash, cashier’s check or certain bank checks. Each bid is by law an irrevocable offer to purchase. However, a higher bid cancels an earlier bid. It is unlawful and a criminal offense (a fine of $10,000 or up to one year in jail) to offer anyone consideration not to bid, or to fix or restrain the bidding process in any manner.
Postponement
Sales may be postponed by announcement at the time and location specified for the intended sale. The borrower may postpone the sale in order to obtain cash, provided the written request for postponement identifies source from which the funds are to be obtained, and the postponement is only for one business day. The borrower may obtain one such postponement.
Reinstatement
Debtors may reinstate up to five days before non-judicial foreclosure sale.
Junior
Junior lien holders may no longer redeem, so they may try to protect themselves by (1) advancing funds to bring the senior loan payments current, then foreclosing for the sums advanced; (2) bidding at the foreclosure sale so the price will be sufficient to pay off the senor and the junior liens; or (3) acquire the property by bidding at the foreclosure. If the debtor has a right to redeem and does so, the junior who purchased the home must be reimbursed. Junior liens do not reattach the property if a borrower redeems a senior lien whose foreclosure extinguished the junior. This helps borrowers by encouraging the junior to bid up to the property to fair market value at the foreclosure sale, or else lose out, giving borrowers closer to fair value at sale.
Deficiency
Lenders may not seek a deficiency judgment if (1) the foreclosure is non-judicial or if (2) foreclosure is on a purchase money obligation. The same rules do not apply to guarantee or later lien holders. The lenders may seize alternative collateral. If the lender forecloses by filing a lawsuit, then the lender can obtain both a foreclosure sale order and a judgment against the borrower for a deficiency after the court-ordered sale, but only for the difference between the judgment and the fair value of the security.
Redemption
A borrower’s right to redemption is terminated when a deficiency judgment is waived or prohibited. When redemption is permitted, after judicial foreclosure, only the borrower can now redeem and junior lien holders or "redemptionors" may not. When the lender is permitted to seek a deficiency, elects to pursue a deficiency and forecloses judicially, the borrower may redeem 12 months after sale, but a full credit bid by the lender cuts it to 3 months.
[addsig]
Very interesting about California. Are MO the same? My friend has less than 8 days to the forclosure. She called an attorney and was told "you signed the papers, you should have paid more attention to the legal description." So, in spite of the fact that the loan application and other papers were all for the house and 5 acres, the mortgage co tacked on the additional 15 acres into the description and now she is stuck?? She is going to be forclosed on the entire piece for the appraisal price of the house and 5 acres? This seems really rotten. How many of us really read the description and take the time to figure out if "from a point SW of a point NW to the intersection of A,B,C is, in fact, 5 acres or 20 acres." Does she have a prayer of being without any property before the forclosure???
She needs help now.
Please note that the transfer of the property to the daughter to avoid the possibility of a creditor taking it is fraud.
True.. this woman went to an attorney the day after her husband died from a heart attack (resuscitated after several minutes of lifelessness) and taken to hospital. No insurance, of course. She was advised not to declare bankruptcy and to put the property (she thought she owned) in daughter's name to possibly protect it and have something after forclosure on home. It is moot point now that entire property was in her name and bank's and she was not aware of that. I am fortunate to have never been in such a mess, but I have sympathy for those that are, and I believe that hiding assets has become the "American Way." It is similar to those that give their wealth away so that they can be on Medicaid when they need nursing home or long-term care instead of saving for a "rainy day" like our grandparents did. Let's face it, America is made up today of those people who complain about the poor getting entitlements, yet do what they can to "work" the law in their behalf so that other tax payers can pick up the slack from their slick deals to defraud in "legal" ways. A person losing everything, regardless of their mistakes my heart break. :-(