Thursday, June 9, 2016
Notice of Trustee Sale
"Notice of Trustee's Sale"...These are not words that anyone likes to see on their title commitment, but they don’t mean that your transaction is dead. By the time the trustee has recorded a Notice of Trustee’s Sale and it appears on your title commitment, the foreclosure process is already at least 60 days along.
Since the actual sale of the property cannot take place any sooner than 90 days after the recording of the Notice of Sale, there is usually time to bring your transaction to a successful close before the sale occurs. Additionally, the trustee has the ability to forestall the sale (called a continuance) for up to 120 days from the date of sale as it shows on the recorded notice. The trustee can do this by simply showing up at the sale location and time and verbally communicating that the sale has been continued to a new date.
There are 150 days from the first time the lender contacts the seller to the first day that the property could possibly be sold at a trustee’s sale (with the possibility of negotiation for another 120 days with a strong offer).
Once the sale has been continued more than 120 days, or more than 120 days have elapsed from the date of sale as shown on the Notice of Trustee’s Sale, the Notice is expired and the trustee has to start the process over again with a new Notice of Trustee’s Sale and a new 90 day waiting period. Due to the expense associated in doing this, many lenders will not allow the Notice to expire and will instruct the trustee to hold the sale on the 119th day, even if they are in negotiations with a prospective buyer on a short sale.
These time frames are set by statute and are not flexible, except in cases where the party in foreclosure has filed for bankruptcy or you have knowledge of a bankruptcy.
For questions regarding a Notice of Trustee’s Sale, please contact me or your title officer for information specific to your transaction.
Today's blog courtesy of Lauren Yost, Chicago Title Company