I’m in CA. I received recorded title of the property on May 1.
Thereafter, a Trustee’s Deed is recorded on May 9.
On the Trustee’s Deed:
Sale Date–April 22? Notary Date–May 3
who is the current rightful owner of the property?
Alexy … you don’t give enough ‘specifics’ to answer … but I’ll try
Did you ‘buy’ the property??Did it go through escrow??Was it a full value transfer? Or a gift??
I have seen plenty of instances where an underwater property owner effectively ‘gives up’ and ‘quit claims’ the property to a friend or relative, who in turn rents out the property w/o paying the mortgage. The transfer of title does not?prevent a lender from moving full speed ahead with a foreclosure.?
In your question/example you noted that you received title and recorded such on May 1st and someone later (May 9) recorded a Trustee’s Deed. This suggests that you did NOT go through escrow on your acquisition of the property, as it was under NOD/NTS and subsequently sold at auction (April 22). If the trustee sale buyer recorded the TDUS within 15 days of the auction, the sale date will be the date of the auction (i.e. April 22 in your case). ?But regardless, your title transfer on May 1st would not preclude the lender/beneficiary from taking the loan to sale unless/until the borrower was able to bring that foreclosing loan current and formally cancel the NOD/NTS … which evidently did not happen … as the property sold at auction (April 22). So the ‘rightful owner’ of the property is the party who bought the loan at auction, contingent upon that party obtaining clear title by clearing (paying off) any recorded obligations that were senior to the loan that went to sale.
I believe it is simpler than idannyb makes it out to be - a trustee sale wipes out almost every encumbrance after the date the loan that was foreclosed on was originally made - including subsequent transfers (sales). Unless the trustee sale was held in error (for example you have proof the loan was paid off prior to the trustee sale), then your purchase has likely been wiped out. The buyer at trustee sale is the rightful owner regardless of whether or not they recorded the deed within 15 days, and regardless of whether or not there are senior liens (though they would remain outstanding on the property). Hopefully you purchased the property with title insurance. If so you should immediately file a claim and let them sort it out. I’ve personally purchased a couple of properties at trustee sale in exactly this situation and in each case the title company settled with me (the trustee sale buyer) to allow the buyer they insured to stay in the property. This is one of those handful of situations where title insurance really pays off.