Foreclosure

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Foreclosure

I just wanted to know if a mortgage company can seize your house and clean out your possesions without giving the owner notice

Asked on May 15, 2009 under Real Estate Law, Nevada

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 13 years ago | Contributor

The primary method of foreclosure in Nevada involves what is known as "non-judicial foreclosure". This type of foreclosure does not involve court action but requires notice commonly called "foreclosure by advertisement".  When the trust deed is initially signed it will usually contain a provision called a "power of sale" which upon default allows a trustee to sell the property in order to satisfy the underlying defaulted loan.  The trustee acts as a representative of the lender to effectuate the sale which typically occurs in the form of an auction.  Because this is a non-judicial remedy there are very stringent notice requirements and the legal documents are required to contain the power of sale language in order to use this type of foreclosure method.

Power of sale notice requirements are:

  1. Prior to initiating a foreclosure the lender must serve a notice of default where a borrower has 35 days to cure any default. This must be sent by certified mail and the defaulting borrower has 15 days prior to the sale and after receiving this notice to cure any default. The foreclosure will stop if an intent to cure is filed with the Public Trustees office within this time frame.
  2. A notice of foreclosure sale must be made within 21 days of the date of the sale and at a time, place and manner as stated in the notice of default.  Sale must take place in the same manner as an execution sale would occur in a judicial foreclosure.

In Nevada, the lenders can also go to court in what is known as a "judicial foreclosure" proceeding where the court must issue a final judgment of foreclosure.  Usually if the deed of trust does not contain the power of sale language, the lender must seek judicial foreclosure.  The property is then sold as part of a publicly noticed sale.  A complaint is filed in court along with what is known a "lis pendens".  A lis pendens is a recorded document that provides public notice that the property is being foreclosed upon.


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