If your answer to the above question is yes, make sure you know your rights. When you take out a loan to purchase residential property in Nevada, you will likely sign a promissory note and a deed of trust. A promissory note is basically an IOU that contains the promise to repay the loan, as well as the terms for repayment. The deed of trust provides security for the loan that is evidenced by a promissory note. If you miss a payment, most loans include a grace period of ten or fifteen days after which time the loan servicer will assess a late fee. To find out the late charge amount and grace period for your loan, look at the promissory note that you signed. This information can also be found on your monthly mortgage statement.
If you miss a few mortgage payments, your mortgage servicer will probably send a letter or two reminding you to get caught up, as well as call you to try to collect the payments. Don’t ignore the phone calls and letters. This is a good opportunity to discuss foreclosure avoidance options and attempt to work out an agreement, like a loan modification, forbearance or payment plan. Under federal laws that went into effect January 10, 2014, the servicer normally must wait until you are 120 days delinquent on payments before making the first official notice or filing for any nonjudicial or judicial foreclosure.
Nevada law requires the servicer or owner of the loan to send the borrower a notice that contains information about the account, including the total amount needed to cure the default and includes information about foreclosure prevention alternatives, among other things. Nev. Rev. Stat. § 107.500. In Nevada, most residential foreclosures are nonjudicial. This means the lender can foreclose without going to court as long as the deed of trust contains a power of sale clause.
The Nevada nonjudicial foreclosure process formally begins when the trustee, a third-party, records a Notice of Default and Election to Sell (NOD) in the office of the recorder in the county where the property is located, providing three months to cure the default. A copy of the NOD must be sent to each person who has a recorded request for a copy and each person with an interest or claimed an interest in the property by registered or certified mail within ten days after the NOD is recorded. Nev. Rev. Stat. § 107.090. If a residential foreclosure, a copy of the NOD must be posted on the property, Nev. Rev. Stat. § 107.087, and the trustee or beneficiary (lender) must record a notarized affidavit. See Nev. Rev. Stat. § 107.0805 for what must be included in the affidavit.
If you are about to be in the throes of the nonjudicial foreclosure process, don’t give up…there is still hope. Have you heard of the Nevada Foreclosure Mediation Program? Stay tuned over the next month for more information!