In Arizona, distressed homeowners typically have good options to chose from in order to get out from under the distressed property. But there is no one-size-fits-all solution that works for everyone. What makes sense for you depends on your specific facts and objectives. Sounds like your 2nd position lienholder is signaling that it is willing to pursue the deficiency. You should get some legal advice about that.
The seller is required by Arizona Law to disclose all known material defects of the property prior to closing. If that didn't happen, you should explore your legal remedies.
Arizona has a wrongful lien statute with some teeth. Basically, you can made written demand that the person who recorded the encumbrance against your property remove it within 20 days, or else the person could be liable for three times the damages caused by the wrongful lien plus your attorney’s fees.
If your lease predates the recorded Notice of Trustee’s Sale, you have some rights under the Protecting Tenants in Foreclosure Act. Basically, that means you don’t necessarily have to move after the foreclosure. If your lease happened after the recorded Notice of Trustee’s sale, your landlord should have disclosed it. You may have some claims worth pursuing along those lines. Arizona Law says 48 hours notice is all that is required as long as it is a reasonable time of day.
Sounds like you are familiar with the Protecting Tenants in Foreclosure Act of 2009. If it is anyone in the property besides a bona fide tenant as defined in that Federal law, you can either induce them to leave or force them to leave. Most sophisticated entities taking back properties at trustee’s sale prefer to use the carrot (usually some kind of cash-for-keys incentive) rather than the stick (eviction). But the stick works just fine. It starts with a 5 day notice to vacate the property....
If you are still within the inspection period of your purchase contract, you can give written notice to the seller that you disapprove the condition of the AC unit. The seller then has the choice to repair or replace it or let you out of the contract. If the seller declines to repair or replace, you may have to decide whether it is worth it to close on the contract and to repair or replace the AC unit yourself.
It is unlikely that the estate of your mother would have any residual liability should the property go to foreclosure. But the estate could have some deficiency issues and tax problems to resolve depending on the nature of the underlying financing. There may be compelling reasons for the personal representative of the estate to consider various alternatives to foreclosure as well.
If you were originally obligated on the loan(s) secured by the property, you may be responsible for the deficiency (the balance owed) after the trustee’s sale. It depends on the nature of the financing and the property.
You have an issue with that 2007 HELOC. To come under the protection of the anti-deficiency statute, it must have been used to purchase or refinance the purchase money loan for the same property. Since you borrowed money against the first home to purchase an entirely different property, the loan is not a “purchase money” loan. Therefore, under Baker v. Gardner, the lender may be allowed to waive its security and sue on the underlying balance on the loan.
The answer to your question may hinge on how the lease was drafted. Generally, landlords have the flexibility to work with renters by accepting progress payments towards the full amount of the monthly rent. Accepting partial rent without a written statement saying it’s not payment in full does not necessarily waive the landlord’s right to collect the balance. But there are situations where acceptance of partial rent could result in a waiver of the balance owed for that month. It depends on the...