Arizona foreclosures Law

Arizona foreclosures law have effect both in court and out-of-court. It usually takes 90 days process period in Arizona State. Arizona foreclosure law holds up the deed of trust and mortgage as primary security instruments. Arizona foreclosure law does not permit right of redemption. Deficiency Judgments are allowed by Arizona foreclosure law but it varies according to term and conditions.

No matter which foreclosure process is adopted judicial or non-judicial, lender in Arizona State may foreclose on deeds of trusts or mortgages in default.

The judicial foreclosure
The judicial foreclosure process holds filing a lawsuit to obtain a court order to foreclose on a particular property. The property is auctioned off to the uppermost bidder condition the Court orders to foreclose. The judicial foreclosure process is mostly practiced when mortgage or deed of trust holds the clause “No power of sale”.

Non-Judicial Foreclosure
In case of default Arizona foreclosure law authorizes to carry out the process of non-judicial foreclosure if a power of sale clause exists in the deed of trust or mortgage documents. Deed of trust or mortgage containing the “Power of sale” allows the lender to sell the property in favor of paying off balance of the loan in the case borrower defaults. Lender and their representatives can sell the property bearing the mortgages or deeds of trust having power of sale clause.
Rules to be followed in the non-judicial foreclosure are explained below in “power of sale foreclosure guiding principles”:

Power of Sale Foreclosure guiding principles
If the mortgage or deed of trust comprises of the “power of sale clause” which specifies the time, place and the terms of sale then the specified course of actions must be followed. If power of sale clause does not facilitate the specifications of time, place and terms of sale then non-judicial foreclosure would be followed as bellow:

• At first it is required by trustee to record a notice of sale in the office of the recorder of the county where the property is sited.

• Trustee must mail a copy of the notice of sale via certified mail within five (5) days after the notice is recorded to each party of deed of trust or mortgage.

• It is required to publish notices once a week for four consecutive weeks in a city where property is sited.

• The trustee keep the alternative of posting the notice at least twenty (20) days earlier to the date of sale may on the property to be sold in any noticeable place or may post the notice at the courthouse or at a specified place of business for the trustee where the property is located without breaching peace.

• The sale must be carried out by either the trustee or the trustee’s agent for cash at highest bid offer .Law also permit “Credit bit” that allows a sale at equal or less than the defaulted loan.

• The qualified bidder required to pay the bid price by the (5)pm on next day to proffer , the trustee may postpone the sale condition if bidder fails to make the payment by 5:00 pm, the day after being notified of the option to buy.

• Upon written agreement trustee may pull out the time for a buyer to come up with the payment or else without any further notice trustee may postpone the sale to a new time and place, by giving notice of the new date, time and place via public announcement at the last place and time the property was opened for sale.

• On the completion of sale proceeds will entertain the payment protected by the deed of trust and then to other lien holders at their priority level.

Deficiency suits are allowed bearing the limitation to the difference between the balances owed and the fair market value of the property but not in case where foreclosure property is of 2.5 acres or less and property was of a single one-family or a single two-family dwelling.