Arizona Foreclosure Process

Link to Arizona Foreclosure Laws

Arizona Foreclosure

Arizona Foreclosure Overview

Arizona Foreclosure allows for both the judicial (in court) and non-judicial (out-of-court) foreclosure processes, although most foreclosures are non-judicial in the state. Typical Timeline in an Arizona foreclosure process is a minimum of 3 months

Pre-foreclosure Period

The judicial foreclosure process begins when the lender files a lawsuit against the borrower and records a notice of the pending lawsuit (known as a Lis Pendens). The court filing must include both the debt and default amount. The borrower and any junior lien holders are notified of the pending lawsuit either in person or by publication. If the borrower does not respond to the court action, the court can rule against him by default and set the amount owed to the lender.

The non-judicial foreclosure process may be initiated if a clause exists in the trust deed which permits the lender to sell the property upon the borrower’s default. To start this process, the trustee records a Notice of Trustee Sale (NTS). The sale occurs at least three months after the notice is recorded. up until 5:00 p.m. of the day before the sale, the borrower, or any junior lien holders, may stop the foreclosure by paying the default amount owed plus any fees and costs.


Notice of Sale & Auction

Judicial Foreclosure:

If the borrower does not respond to the pending lawsuit, the county clerk then directs the sheriff to conduct a sale of the property to recover the amount owed. A Notice of Foreclosure Sale (NFS) is published and recorded and the sheriff is charged with conducting the sale of the property 45 days after the notice. The sale is a public auction and anyone may bid. The winning bidder must pay the full price to the sheriff by 5:00 p.m. the following day. Once that occurs, a certificate of sale is issued.

If the property is not abandoned there is a the redemption period of six months from the sale date. If the borrower does not redeem within that period of time, secondary lenders may do so within a specified time.  The total amount owed plus any fees and costs must be paid to redeem the property. If no one redeems the property, the sheriff then transfers ownership to the winning bidder.

Non-judicial Foreclosure:

In this situation, a Notice of Trustees Sale (NTS) is published. The NTS will contain the property description along with the date, time and place of the pending sale. The notice is recorded with the county, and the trustee mails the notice to all affected parties a minimum of three months before the sale date. The notice must also appear in a local newspaper once a week for four weeks, with the last notice published no less than 10-days before the sale date. in addition, at least 20 days before the sale, the notice must be posted on the property and at the county courthouse. The trustee must provide the opening bid of the sale to anyone who asks starting the day before the sale, and up to the sale, or the sale may have to be postponed.

The trustee (or the trustee’s agent) conducts the sale at the property either at the courthouse or at the trustee’s office. Usually at the courthouse.  All bidders must provide a refundable $10,000 deposit in order to bid; and the trustee keeps the deposit of the winning bidder. The sale can be postponed up to 90-days before the originally scheduled sale. Just as in the Judical Foreclosure, the winning bidder has until 5:00 p.m. the next day to pay the full bid price, after which the trustee transfers ownership of the property within seven days. The proceeds of the sale are paid to the primary lender, then to any secondary lenders. There is no right of redemption after a non-judicial foreclosure sale.


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