What Are the Nevada Laws About Deficiency Judgment?

Nevada Mortgage Laws About Deficiency Judgment

NEVADA MORTGAGE LAWS:
In this session, we are going to discuss in somewhat greater details the Nevada Mortgage Laws and how to handle the looming foreclosure crisis which has state of Nevada in the highest ranks in USA.

NRS 40.430 Action for recovery of debt secured by mortgage or other lien; “action” defined.
Nevada has only One Action Law for the recovery of any debt, or for the enforcement of any right secured by a mortgage or other lien upon real estate. That action must be in accordance with the provisions of NRS 40.430 to 40.459, inclusive. In that action, the judgment must be rendered for the amount found due the plaintiff, and the court, by its decree or judgment, may direct a sale of the encumbered property, or such part thereof as is necessary, and apply the proceeds of the sale as provided in NRS 40.462.

What is One Action Rule of Nevada?
This section must be construed to permit a secured creditor to realize upon the collateral for a debt or other obligation agreed upon by the debtor and creditor when the debt or other obligation was incurred. A sale directed by the court pursuant to subsection 1 must be conducted in the same manner as the sale of real property upon execution, by the sheriff of the county in which the encumbered land is situated, and if the encumbered land is situated in two or more counties, the court shall direct the sheriff of one of the counties to conduct the sale with like proceedings and effect as if the whole of the encumbered land were situated in that county.

What this One Action Rule Does Not Include?
(a) To appoint a receiver for, or obtain possession of, any real or personal collateral for the debt or as provided in NRS 32.015.
(b) To enforce a security interest in, or the assignment of, any rents, issues, profits or other income of any real or personal property.
(c) To enforce a mortgage or other lien upon any real or personal collateral located outside of the State which does not, except as required under the laws of that jurisdiction, result in a personal judgment against the debtor.
(d) For the recovery of damages arising from the commission of a tort, including a recovery under NRS 40.750, or the recovery of any declaratory or equitable relief.
(e) For the exercise of a power of sale pursuant to NRS 107.080.
(f) For the exercise of any right or remedy authorized by chapter 104 of NRS or by the Uniform Commercial Code as enacted in any other state.
(g) For the exercise of any right to set off, or to enforce a pledge in, a deposit account pursuant to a written agreement or pledge.
(h) To draw under a letter of credit.
(i) To enforce an agreement with a surety or guarantor if enforcement of the mortgage or other lien has been automatically stayed pursuant to 11 U.S.C. § 362 or pursuant to an order of a federal bankruptcy court under any other provision of the United States Bankruptcy Code for not less than 120 days following the mailing of notice to the surety or guarantor pursuant to subsection 1 of NRS 107.095.
(j) To collect any debt, or enforce any right, secured by a mortgage or other lien on real property if the property has been sold to a person other than the creditor to satisfy, in whole or in part, a debt or other right secured by a senior mortgage or other senior lien on the property.
(k) Relating to any proceeding in bankruptcy, including the filing of a proof of claim, seeking relief from an automatic stay and any other action to determine the amount or validity of a debt.
(l) For filing a claim pursuant to chapter 147 of NRS or to enforce such a claim which has been disallowed.
(m) Which does not include the collection of the debt or realization of the collateral securing the debt.
(n) Pursuant to NRS 40.507 or 40.508.
(o) Which is exempted from the provisions of this section by specific statute.
(p) To recover costs of suit, costs and expenses of sale, attorneys’ fees and other incidental relief in connection with any action authorized by this subsection.

How Mortgage is Defined Under Nevada Laws?
NRS 40.433 “Mortgage or other lien” defined. A “mortgage or other lien” includes a deed of trust, but does not include a lien which arises pursuant to chapter 108 of NRS, pursuant to an assessment under chapter 116, 117, 119A or 278A of NRS or pursuant to a judgment or decree of any court of competent jurisdiction.

The Judicial Proceedings Are An Affirmative Defense
1. The commencement of or participation in a judicial proceeding in violation of NRS 40.430 does not forfeit any of the rights of a secured creditor in any real or personal collateral, or impair the ability of the creditor to realize upon any real or personal collateral, if the judicial proceeding is:
(a) Stayed or dismissed before entry of a final judgment; or
(b) Converted into an action which does not violate NRS 40.430.
2. If the provisions of NRS 40.430 are timely interposed as an affirmative defense in such a judicial proceeding, upon the motion of any party to the proceeding the court shall:
(a) Dismiss the proceeding without prejudice; or
(b) Grant a continuance and order the amendment of the pleadings to convert the proceeding into an action which does not violate NRS 40.430.
3. The failure to interpose, before the entry of a final judgment, the provisions of NRS 40.430 as an affirmative defense in such a proceeding waives the defense in that proceeding. Such a failure does not affect the validity of the final judgment, but entry of the final judgment releases and discharges the mortgage or other lien.
4. As used in this section, “final judgment” means a judgment which imposes personal liability on the debtor for the payment of money and which may be appealed under the Nevada Rules of Appellate Procedure.

How Surplus Money is Distributed?
NRS 40.440 Disposition of surplus money. If there is surplus money remaining after payment of the amount due on the mortgage or other lien, with costs, the court may cause the same to be paid to the person entitled to it pursuant to NRS 40.462, and in the meantime may direct it to be deposited in court.
FORECLOSURE SALES AND DEFICIENCY JUDGMENTS
I have been asked about deficiency judgment many times. In Nevada, the time period for filing a deficiency judgment by your lender is only 6 months. However, they can file this deficiency judgment and can enforce it later against you. I have been asked frequently about the laws of deficiency judgment in Nevada. This is a concise summary of all of the laws of deficiency judgment. Please read carefully and seek the help of a licensed attorney before doing anything or filing any action.

What is an Indebteness?
NRS 40.451 “Indebtedness” defined. “indebtedness” means the principal balance of the obligation secured by a mortgage or other lien on real property, together with all interest accrued and unpaid prior to the time of foreclosure sale, all costs and fees of such a sale, all advances made with respect to the property by the beneficiary, and all other amounts secured by the mortgage or other lien on the real property in favor of the person seeking the deficiency judgment. Such amount constituting a lien is limited to the amount of the consideration paid by the lienholder.

NRS 40.453 Waiver of rights in documents relating to sale of real property against public policy and unenforceable; exception. Except as otherwise provided in NRS 40.495:
1. It is hereby declared by the Legislature to be against public policy for any document relating to the sale of real property to contain any provision whereby a mortgagor or the grantor of a deed of trust or a guarantor or surety of the indebtedness secured thereby, waives any right secured to him by the laws of this state.
2. A court shall not enforce any such provision.

How Deficiency Judgment is Awarded?
NRS 40.455 Deficiency judgment: Award to judgment creditor or beneficiary of deed of trust.
1. Upon application of the judgment creditor or the beneficiary of the deed of trust within 6 months after the date of the foreclosure sale or the trustee’s sale held pursuant to NRS 107.080, respectively, and after the required hearing, the court shall award a deficiency judgment to the judgment creditor or the beneficiary of the deed of trust if it appears from the sheriff’s return or the recital of consideration in the trustee’s deed that there is a deficiency of the proceeds of the sale and a balance remaining due to the judgment creditor or the beneficiary of the deed of trust, respectively.
2. If the indebtedness is secured by more than one parcel of real property, more than one interest in the real property or more than one mortgage or deed of trust, the 6-month period begins to run after the date of the foreclosure sale or trustee’s sale of the last parcel or other interest in the real property securing the indebtedness, but in no event may the application be filed more than 2 years after the initial foreclosure sale or trustee’s sale.

What is the Procedure for a Hearing of a Deficiency Judgment in Nevada? NRS 40.457 1. Before awarding a deficiency judgment under NRS 40.455, the court shall hold a hearing and shall take evidence presented by either party concerning the fair market value of the property sold as of the date of foreclosure sale or trustee’s sale. Notice of such hearing shall be served upon all defendants who have appeared in the action and against whom a deficiency judgment is sought, or upon their attorneys of record, at least 15 days

The preservation of human life is the ultimate value, a pillar of ethics and the foundation of all morality. This held true in most cultures and societies throughout history.

On first impression, the last sentence sounds patently wrong. We all know about human collectives that regarded human lives as dispensable, that murdered and tortured, that cleansed and annihilated whole populations in recurrent genocides. Surely, these defy the aforementioned statement?

Liberal philosophies claim that human life was treated as a prime value throughout the ages. Authoritarian regimes do not contest the over-riding importance of this value. Life is sacred, valuable, to be cherished and preserved. But, in totalitarian societies, it can be deferred, subsumed, subjected to higher goals, quantized, and, therefore, applied with differential rigor in the following circumstances:

1.. Quantitative – when a lesser evil prevents a greater one. Sacrificing the lives of the few to save the lives of the many is a principle enshrined and embedded in activities such as war and medicinal care. All cultures, no matter how steeped (or rooted) in liberal lore accept it. They all send soldiers to die to save the more numerous civilian population. Medical doctors sacrifice lives daily, to save others.

It is boils down to a quantitative assessment (“the numerical ratio between those saved and those sacrificed”), and to questions of quality (“are there privileged lives whose saving or preservation is worth the sacrifice of others’ lives?”) and of evaluation (no one can safely predict the results of such moral dilemmas – will lives be saved as the result of the sacrifice?).

2.. Temporal – when sacrificing life (voluntarily or not) in the present secures a better life for others in the future. These future lives need not be more numerous than the lives sacrificed. A life in the future immediately acquires the connotation of youth in need of protection. It is the old sacrificed for the sake of the new, a trade off between those who already had their share of life – and those who hadn’t. It is the bloody equivalent of a savings plan: one defers present consumption to the future.

The mirror image of this temporal argument belongs to the third group (see next), the qualitative one. It prefers to sacrifice a life in the present so that another life, also in the present, will continue to exist in the future. Abortion is an instance of this approach: the life of the child is sacrificed to secure the future well-being of the mother. In Judaism, it is forbidden to kill a female bird. Better to kill its off-spring. The mother has the potential to compensate for this loss of life by bringing giving birth to other chicks.

3.. Qualitative – This is an especially vicious variant because it purports to endow subjective notions and views with “scientific” objectivity. People are judged to belong to different qualitative groups (classified by race, skin color, birth, gender, age, wealth, or other arbitrary parameters). The result of this immoral taxonomy is that the lives of the “lesser” brands of humans are considered less “weighty” and worthy than the lives of the upper grades of humanity. The former are therefore sacrificed to benefit the latter. The Jews in Nazi occupied Europe, the black slaves in America, the aborigines in Australia are three examples of such pernicious thinking.

4.. Utilitarian – When the sacrifice of one life brings another person material or other benefits. This is the thinking (and action) which characterizes psychopaths and sociopathic criminals, for instance. For them, life is a tradable commodity and it can be exchanged against inanimate goods and services. Money and drugs are bartered for life.

The Commonwealth of Virginia and Governor Timothy M. Kaine have for some time been encouraging Virginia Schools high school students to take more rigorous coursework. The Governor recently announced the pilot Commonwealth Scholars Program and promotional campaign to underscore this commitment to excellence in Virginia’s youth.

Eleven divisions within the Virginia schools initially will participate in the new program. The required rigorous coursework goes beyond the minimum graduation requirements for a Standard Diploma, but falls below the college preparation coursework requirements for an Advanced Studies Diploma. Students who complete the core coursework under the Virginia schools program will be recognized as Commonwealth Scholars at graduation and eligible to receive a special diploma seal that recognizes their achievement. Instructional support will be provided to all students who participate.

A two-year, $300,000 State Scholars Initiative grant from the U.S. Department of Education funds the Commonwealth Scholars Program. Virginia schools were one of eight states selected in a national competition to participate in the federal grant program.

The Virginia schools divisions were chosen based on their interest in the program and their ability to meet the requirements of the grant. The eleven Virginia schools’ divisions are:

? Albemarle County
? Alexandria
? Bristol
? Carroll County
? Chesterfield County
? Henry County
? Lancaster County
? Nottoway County
? Richmond
? Roanoke County
? Scott County

The Virginia Career Education Foundation, a statewide business and education partnership, will lead the Virginia schools initiative. They will work with participating school divisions to develop partnerships with local businesses and to promote the program. Private sector volunteers will be trained to make presentations to the students, focusing on how the rigorous high school courses will improve their post-high school career opportunities.

The Commonwealth Scholars Program is based on a core course of study that includes:

? Four years of English;
? Three years of mathematics – Algebra I and II, and geometry;
? Three years of science – biology, chemistry and physics;
? Three and half years of social studies – selected from United States and Virginia history, world history, geography, economics and financial literacy, United States and Virginia government;
? Two years of health and physical education; and
? Two years of language other than English.

Research has shown that there is a strong correlation between the academic rigor of high school coursework taken and postsecondary degree completion. One example is mathematics – 40 percent of students who took Algebra II in high school earned a bachelor’s degree, as compared to only 23 percent of graduates who stopped taking high school mathematics at geometry.

Governor Kaine has confidence that the new Commonwealth Scholars Program will encourage many Virginia schools students to continue onto college after graduation. He has thrown down the gauntlet and issued a challenge to those Virginia schools students who are not on track for an Advanced Studies Diploma. His hope is that they will reach higher and strive to move from competence to excellence.