Investors Trustee Services, Inc.

Investors Trustee Services is a Trustee Sale company licensed by the Arizona Department of Real Estate. Unlike many other Trustee Sale Companies, we require no up front fees in most cases. Our 90% reinstatement rate is evidence of our commitment to work with borrowers to get them back on track and making timely payments.

About Our Staff

Charlie Sykes,
Executive Vice President, Owner

Cindy Gregg
Assistant Vice President

Contact Us: Email: itservices.cindy@gmail.com

4008 N. 15th Avenue
Phoenix, AZ 85020

Phone: (602) 234-2828

What You Should Know About Foreclosure

When a Trustor (the Borrower), is in default in performance of a Promissory Note and Deed of Trust, the Beneficiary (the Lender or purchaser), can force a sale of the property that was used as collateral. This sale is called a Trustee Sale: a non-judicial process used to enforce the terms of a Promissory Note and Deed of Trust.

In order to begin the Trustee Sale process, the Beneficiary first confers authority to foreclose to a third party Trustee via the "Power of Sale", as described in the Arizona Revised Statutes.

The typical Trustee Sale procedure takes at least 91 days, beginning with the recording of a Notice of Trustee Sale and ending with a public auction. After the Notice of Trustee Sale is recorded, strict guidelines set by the State of Arizona must be followed in order to ensure the and validity of the Trustee Sale, including a specific timeline and careful documentation. In accordance with the first requirement, the Trustee mails copies of the Notice of Trustee Sale and a Notice of Breach to all parties with a vested interest in the subject property. The Notice is also published in a newspaper for four consecutive weeks and is posted at both the property and the county courthouse.

Sixty (60) days after the process begins, the Beneficiary is mailed a credit bid for approval. This credit bid will serve as the opening bid at the auction, and includes all monies owed to the Beneficiary, Trustee's fees, and third party fees incurred in the Trustee Sale process. When the auction is held approximately 31 days later, the property is sold to the highest bidder. If there are no bidders, the property then reverts to the Beneficiary.

Upon payment of the bid price by the successful bidder, or payment of Trustee's fees by the Beneficiary if the property reverts, a Trustee's Deed upon Sale is recorded and title is conveyed to the new owner.

When You Should Start a Trustee's Sale

Promissory Notes and Deeds of Trust can vary widely in the terms and notification requirements, affecting the time frame for foreclosure. In most Promissory Notes and Deeds of Trust, the Trustor agrees to make payments on a specific date. The Note usually provides for a grace period for monthly payments and may contain a requirement that the Beneficiary give the Trustor a notice of the intent to foreclose in the event that the payment is not made within that grace period. Additional waiting periods may be applicable, as specified in the Note. All of these provisions can affect the most favorable time frame to start a Trustee Sale.

In some cases litigation may be necessary. For example, in a literal interpretation of many Deeds of Trust, the Beneficiary may claim that the Trustor has defaulted when a payment has not been received by the first day after the due date. The Beneficiary then directs the Trustee to file a notice of default. Practically speaking, a court or jury may not look favorably on such fast action unless the action was deemed reasonable or there was just cause, such as an abandoned property or a history of delinquent payments. It is usually acceptable when a Trustee Sale is started after the Trustor is delinquent for thirty (30) days or more.

When a Trustee's Sale Must Be Postponed or Cancelled

The Beneficiary may direct the Trustee to cancel or postpone a Sale at any time for almost any reason. The Trustee is, however, required to postpone a Sale if the Trustor files for protection under any chapter of the Bankruptcy Code.

If the required posting and publishing have not yet been completed, the Trustee Sale must be cancelled altogether.

When the Trustee is notified of a bankruptcy, the Trustee must postpone the scheduled sale of the property. Multiple postponements may be made, but in periods not to exceed ninety (90) days. Minimum periods of postponement may be as little as one (1) hour, however consideration should be given as to purpose, intent, and cost of postponement. Once the automatic stay is lifted, the Trustee Sale can be held no sooner than the next postponement date.

If a Trustor files for bankruptcy protection under Chapter 13 and a reorganization plan is submitted and confirmed, the Trustee Sale must be canceled. If the Trustor defaults thereafter, a new Notice of Default and Notice of Trustee Sale can be recorded and a new Trustee Sale started.

Most foreclosure auctions last only a few minutes. Since the Beneficiary has given direction to the Trustee to foreclose on the collateral, it is not necessary for the Beneficiary to attend the sale. Prior to the sale, the Trustee calculates a Credit Bid Statement that accounts for all amounts due to the Beneficiary, including fees incurred in the foreclosure process. The Trustee establishes this credit bid as the opening, or minimum, bid to be accepted at the auction. The Beneficiary may reduce the credit bid if desired.

All bidding is open and verbal. The highest bidder must deliver good funds to the Trustee by 5:00 P.M. the next business day in order to obtain title to the property. Upon acceptance of funds, a Trustee's Deed upon Sale is prepared and recorded, conveying the property to the highest bidder, or to the Beneficiary if no bids were made. All amounts due to the Beneficiary are disbursed as soon as possible after receipt of bid proceeds and recording the Trustee's Deed, taking into account bank policies on availability of funds.

Overbidding

Occasionally a Beneficiary may want to acquire the property rather than being repaid. Frequently there are others who will bid on the property, thereby increasing the offer price greater than the credit bid. In that event, the Beneficiary may bid in the auction and, like other bidders, must tender any amount over the credit bid if named the successful bidder.

When such overbids are made, all funds in excess of the minimum bid are disbursed to junior lien holders, by priority of lien, until all lien holders are satisfied. If excess funds remain after payment of junior lien holders, or if no junior lien holders exist, the Trustor being foreclosed is entitled to any remaining amounts. Another option to the Trustee is to deposit all excess funds with the County Treasurer in the county where the property is located. Example: Credit bid is $100,000 and the highest bid at the trustee sale is $110,000. Excess fees over the credit bid amount could be sent to the county at the option of the Trustee.

Deficiency

In some cases, the value of the property being sold at a Trustee Sale is less than the amount due the Beneficiary, including costs and fees.

Also in some cases a Beneficiary may attempt to collect and recover any difference between the Sale price and the amount owed to the Beneficiary by obtaining a deficiency judgment from the courts.

An action for deficiency judgment must be started within ninety (90) days after the Trustee Sale and cannot be sustained against properties of 2 1/2 acres or less which are limited to and utilized for either a single one-family or a single two- family dwelling.

Judicial Foreclosure

A Beneficiary of a Deed of Trust may elect to foreclose a Deed of Trust other than by Trustee Sale.

Judicial foreclosure is a process conducted by attorneys where a judgment is obtained through litigation. Decisions may be made by a jury trial or summary judgment. When a judgment is awarded, the court orders the sheriff to sell the property, typically in thirty (30) days. Then, by statute, the Trustor has a six-month right of redemption, wherein the Trustor may save the property by paying all principal, interest, and court costs owed. The Beneficiary is paid in full after the property is redeemed. If, however, the Trustor does not redeem the property and if the property is not purchased by a bidder at the sheriff sale, the Beneficiary obtains title via Sheriff's Deed.

What to Do When You Get the Property Back

When the Beneficiary acquires the property as a result of a Trustee Sale, the Trustor's equitable and legal rights to the property have been extinguished. If there is an IRS lien attached to the property, there is a required 120-day waiting period, during which the Trustor may not sell or transfer title on the property. The IRS will decide during that time if they are interested in going after the equity in the property.

In the event that the property is occupied after the Trustee Sale, the Beneficiary should consult an attorney to consider action to evict the occupant, or enter into a formal rental agreement.

The Beneficiary may wish to liquidate the property. In this case, the Beneficiary should contact a real estate agent.

A Trustee is empowered to foreclose or release a lien on real property as directed by the Beneficiary. A Trustee need not be an attorney. Some matters, however, require advice from and action by an attorney licensed to practice law in Arizona.

Should a Trustor file for bankruptcy protection, the Beneficiary should immediately retain an attorney competent in bankruptcy matters to review and respond to plans and pleadings and to advise the Trustee as to postponement dates. Failure to do so could result in repayment agreements unfavorable to the Beneficiary.