The Wrong Remedy at the Wrong Time, Part 1
By Daniel Edstrom
DTC Systems, Inc.
New Note added on 1/22/2012 thanks to Simonee. California Probate Code does not seem to apply based on this California Supreme Court decision: Monterey S.P. Partnership v. W. L. Bangham, Inc. (1989) 49 Cal.3d 454 , 261 Cal.Rptr. 587; 777 P.2d 623 (download here: http://dtc-systems.net/wp-content/uploads/2012/01/Monterey_SP_Partnership_vs_WL_Bangham.pdf)
Monterey S.P. Partnership v. W. L. Bangham, Inc. (1989) 49 Cal.3d 454 , 261 Cal.Rptr. 587; 777 P.2d 623
Here is a quick overview of what happens in a non-judicial foreclosure. If you are in a judicial state, this post does not apply directly to your case. But if you understand what happens in a non-judicial foreclosure, you may get insight into what might apply to your case.
I am not indicating that any of these documents are true or accurate, just that this is what typically happens.
Closing the Transaction
The homeowner executes a note and security instrument (i.e. Deed of Trust). The parties to the trust created by the Deed of Trust are the trustor (homeowner), trustee (usually a title company) and the beneficiary (either MERS or the named lender). Everyone seems to assume that the trust was constituted (created), that it is valid and continuing. This is where the trouble begins (not really, but for this article we will assume it begins here and not before).
Notice of Default
Supposedly the Notice of Default is recorded and sent to the homeowner by the agent for the beneficiary. Who is the beneficiary? Looking at my notice of default the only beneficiary mentioned is MERS. However, other documents sent usually point to one or more other parties who “might” be a beneficiary.