The Arizona State Senate has passed SB 1259, a bill regarding foreclosures and proof of ownership, that would require lenders in the state of Arizona to prove they have the right to foreclose by providing a complete list of any previous owners of the mortgage note. According to the verbiage in the bill: "Pursuant to Arizona Revised Statutes, Title 33, Chapter 6.1, the trustee is authorized to sell the property on behalf of the beneficiary, typically a lender or bank, due to non-performance or breach of contract, such as delinquent payments. Statute prescribes the actions that a trustee must take in order to sell a trust property by means of a trustee’s sale, including providing notice of the trustee’s sale, conduct of the sale by public auction, execution of the trustee’s deed and disposition of the proceeds of the sale."
Co-sponsored by Arizona Republican Sens. Mi chele Reagan, John McComish and Andy Biggs, SB 1259 is headed to the Arizona State House of Representatives after a 28-2 vote in the Senate on Feb. 22. Among provisions of the bill, SB 1259:
►Requires a non-originating beneficiary on a deed of trust, to record a summary document that contains past names and addresses of prior beneficiaries, the date, recordation number and a description of the instrument that conveyed the interest of each beneficiary.
►Requires the summary document to be recorded at the same time and place that the notice of trustee’s sale is recorded and that a copy be attached to any notice of trustee’s sale that is required.
►Stipulates that failure to properly record the summary document that demonstrates evidence of title for the foreclosing beneficiary as of the date of the trustee’s sale will result in a voidable sale.
►Allows any person with an interest in the trust property to file an action to void the trustee’s sale for failure to comply and is entitled to an award of attorney fees and damages, to include an award of attorney fees for any injunction or other provisional remedy related to the claim.