Nevada Foreclosure Law
In Nevada, lenders may foreclose on mortgages or deeds of trust in default utilizing either a judicial or non-judicial foreclosure process.
Nevada foreclosures are customarily done using the non-judicial process" also called an "out of court foreclosure" and can be completed in about 120 days.
Foreclosure Process
In Nevada, many mortgages allow lenders to sell a property once an owner defaults without having to file a lawsuit. A lender starts the foreclosure process by recording a notice of default with the county recorder and mailing the notice to the borrower 9also called "foreclosure by advertisement"). This is standard since the borrower typically signs a provison called a "power to sell clause" which permits the trustee to sell the property in default to satisfy the delinquent mortgage. It is important to know that a borrower or any lender in secondary position has 35 days from the date the notice of default is recorded to bring the loan status current by paying off delinquent payments plus any late fee penalties to stop the foreclosure.
At 90 days after recording the notice of default, the lender can arrange a foreclosure sale if the borrower has not brought the default amount current.
Notice of Sale / Auction
A trustee (third party named in the deed of trust) carries out the public sale. A notice of sale is posted at least 20 days before the trustee sale date in three public places and published in a local newspaper once a week for three weeks. The notice of sale is also mailed to the affected parties.
The sale may be at the trustee's office, and anyone may bid. Except for the lender, the winning bidder has to pay the full bid amount in cash or cashier's check to the trustee. If the sale is postponed, a public announcement is made at the time and place of the sale. After the sale, the trustee transfers ownership to the winning bidder.
An out-of-court foreclosure provides the winning bidder with clear title, and there is no redemption period for the borrower after an out-of-court foreclosure sale. There is a one year redemption period for judicial foreclosures (in-court foreclosure). A judicial foreclosures albeit uncommon in Nevada, occurs when there is not a power of sale cluase in the mortgage so the processs begins in court.
Nevada mortgage foreclosures laws can be found in Chapter 106, Nevada Revised Statutes and for deed of trust foreclosures they are located Chapter 107.
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