Credit Unions’ Claims Accrued Before They Owned Securities, Says Federal Judge

LOS ANGELES – A federal judge issued a ruling this morning suggesting that the statute of limitations may have expired on NCUA’s claims that Wall Street banks sold mortgage-backed securities they knew were faulty to corporate credit unions, potentially rendering NCUA suits filed earlier this year moot.

In a preliminary ruling filed in U.S. District Court, Judge George Wu said NCUA claims in a suit brought against RBS Securities for the sale of $1.2 billion of MBS to WesCorp FCU  are “insufficient thus far to demonstrate compliance with at least the applicable federal statute of limitations.”

The Judge’s ruling jeopardizes billions of dollars in claims brought by NCUA in five separate suits against Wall Street banks for the failure of WesCorp and four other corporates.

Wu, the same judge who dismissed NCUA’s civil claims against WesCorp directors earlier this year, said the relevant statute of limitations in such tort cases is three years from the time of the purchase of the securities, some of which were bought as early as 2005, and the clock began running even before NCUA took the one-time $34 billion corporate under conservatorship in March 2009. NCUA , which brought the suit in July as liquidating agent for WesCorp, has argued the clock on the statute of limitations should not start running until then.

NCUA’s argument that the clock did not begin until it took WesCorp under conservatorship is “misdirected,” wrote the Judge. “the correct question is whether the three-year period expired before (NCUA) filed this lawsuit.”

In fact, RBS argues that WesCorp should have known of the claims long before the NCUA take over. “Defendants assert that it is clear that WesCorp, had it been diligent, could have known about the basis for its claims (to the extent those claims have any basis) long enough ago that the applicable statutes of limitation would have run before (NCUA) implemented the conservatorship,” wrote Judge Wu.

“Ultimately,” wrote Judge Wu,“with respect to most claims, the defendants’ explanations for why WesCorp should have known of these particular claims earlier is insufficiently persuasive for purposes of ruling as a matter of law, at least at this stage, that the statutes of limitation have run.”

This morning’s ruling casts also doubt on four other suits brought by NCUA against Wall Street banks for their sale of faulty MBS to failed corporate, including U.S. Central FCU, Members United Corporate FCU, Southwest Corporate FCU and Constitution FCU, as well as WesCorp.  Defendants in the other suits include JP Morgan Chase, Goldman Sachs, Wachovia Securities ( now a unit of Wells Fargo), and numerous other Wall Street banking subsidiaries.

Judge Wu has asked NCUA and RBS to file supplemental briefs to bolster the cases and indicated he will issue a ruling on the RBS motion to dismiss in early 2012.

Foreclosure CSI

Treat   foreclosure as a crime scene
By: Matt Stoller
December 15, 2011 11:45 PM EST

Bubbling under the surface   of politics is the foreclosure crisis — where the power of big finance is   brushing up against the rule of law. The party leaders seem to have decided   it is essentially a giant — but unavoidable — tragedy. GOP presidential candidate   Mitt Romney said foreclosures have to clear for the housing market to reset.   The Obama administration, meanwhile, has spent only about $2 billion of the   $75 billion authorized for the Home Affordable Modification Program.But the foreclosure crisis   is not only a few million personal tragedies. It is a few million crime   scenes.. . .

Turning our markets into   playpens for predatory behavior didn’t happen overnight, and it will not be   fixed overnight. But until we have public servants strongly focused on   justice for all, we can expect the crime spree to go on. After all, what   we’re all learning is that, at least for large banks, crime pays.

Matt Stoller worked on   the Dodd-Frank financial reform law and Federal Reserve transparency issues   as a staffer for Rep. Alan Grayson (D-Fla.). He is now a fellow at the   Roosevelt Institute.

Be a DOER with Martin Andelman

We could all do more.  We really could.

Attorney Tom Cox knows it:

Guest Post on Action Steps

Martin Andelman shows it:

Join his army of Doers.  Spend Two Minutes to Help a Disabled War Veteran Being Put Through the BoA Rigors

As Martin notes, we need to get better organized.  And these action steps, if everybody does them, can have a great impact.

It makes me think of an old joke that we used to have, based on a Jon Stewart Daily Show skit, where after 9/11, people would put an American flag sticker on their SUV, and he would say, “It’s the least you can do.  No seriously, the very least.”  So Marc and I would always say that when we saw people putting for the absolute minimal effort on something.  But in some cases, like here, minimal effort times a hundred thousand people can make a real impact.

As we’ve always known, in this homeowner/middle class/foreclosure fight, our greatest strength is strength in numbers.  They might have more money, more politicians in their pockets, more judicial allegiance (for some reason), but we have the masses.

Call to Action From National Ass’n Independent Land Title Agents (NAILTA)

I think that anybody familar with the title issues facing this country following the foreclosure crisis could agree that we need to continue to foster the independent title business,  if we ever want certainty in land sales again.  Or should we just keep rewarding cronyism and monolopolies by the banks/title companies?  It’s all so very cozy, especially when you add the politicians to the mix.  It’s just one big, happy family, kind of like La Familia or the cartels.

Dear Beth K.,

RESPRO and those who support the proliferation of anti-competitive affiliated businesses in the settlement services industry are at it again.

Legislation which would exempt controlled business arrangements from certain provisions in the Dodd-Frank Act regarding Qualified Residential Mortgages may be considered in Congress before the end of the year, according to an article in the Source of Title.

Legislation providing relief to affiliated businesses from regulation that counts fees paid to affiliated businesses toward a 3% cap on closing fees on Qualified Residential Mortgages could be considered by the House Financial Services Committee as soon as the week of December 19th. If not taken up then, the legislation would likely be considered in January or February, when Congress reconvenes.

If successful, a CBA exemption to Dodd-Frank would allow bank-owned and real estate firm-owned title companies to play under a different set of rules than all other settlement service providers, including independent land title agents like you who depend upon a fair market to do business.  RESPRO and the Realty Alliance, along with the bank and realtor lobbies, are pushing hard to obtain this exemption and pushing harder to take away more of your market.  Having this exemption allows referral sources to streamline a large percentage of their mortgage business to captive providers leaving independent title agents and their colleagues on the outside looking in.

In order to stop them, we need your help!  We need each of you to contact the members of the House Financial Services Committee, by phone and email, and tell them you are from NAILTA and a small business owner and you do not support exempting affiliate settlement service providers from Dodd-Frank’s 3% cap on QRM. 

For those who want to spread the word on Twitter, the HFSC Twitter site is located at @FinancialCmte.  Tweet at them as many times as possible!

On behalf of the NAILTA Board, we appreciate your attention and support to these important issues and encourage you to stay involved!



Rob Holman & John Novarina


NAILTA Policy and Legal Affairs Committee

Calling All Notaries: Save Yourselves!

Woman in Loan Fraud Scheme Granted Bail

Posted: Dec 14, 2011 12:01 PM PST Updated: Dec 14, 2011 12:01 PM PST

By Nathan Baca, Investigative Reporter



LAS VEGAS — One of two accused home loan robo-signers faced a judge for the first time Wednesday. Former loan title officer Gerri Shepperd pleaded not guilty to more than 600 counts of fraud.

The Nevada Attorney General’s Office charged Shepperd with paying notaries to forge signatures on home loans to speed up the foreclosure process. The AG says this fraud affects tens of thousands of Nevada home loans.

Three notaries who once worked for Fidelity National Title and Lender Processing Services in Las Vegas are cooperating with the investigation. Prosecutors say they can use more help from the public.

“We encourage them to call and file a complaint with our office. And I can’t say enough; we urge employees, if you’re working for a company or you have worked for a company, and you’re aware that this type of activity was going on or is going on, please come forward,” said Chief Deputy Attorney General John Kelleher.

Shepperd surrendered to AG investigators. She was booked and released on $50,000 bail. Her bail had been reduced from $500,000.

Shepperd’s co-defendant, Gary Trafford, is scheduled to appear in court Friday.


Catherine Cortez Masto, Attorney General

555 E. Washington Avenue, Suite 3900
Las Vegas, Nevada 89101

Telephone – (702) 486-3420
Fax – (702) 486-3283

Web –

Arizonans: Call to Action

If this article is true, it’s time to contact Representative Jack Harper, people.  Not only have they failed to help homeowners in any meaningful way, they’re going to make it easier for the banks to loot:

Planned Arizona bill lets banks go after ‘underwater’ homeowners who bail

Arizona Daily Star | Posted: Saturday, December 10, 2011 12:00 am

PHOENIX – The head of a key House committee wants to scrap state laws that let homeowners who are “underwater” on their homes simply walk away.

Rep. Jack Harper says Arizona’s status as one of a handful of “nonrecourse” states is keeping the real estate market from recovering here. He said having people abandon their homes further depresses the value of nearby homes.

“The idea is to keep people from being encouraged to just walk away from their house any time they’re a little bit upside down” on their mortgage, said Harper, chairman of the House Ways and Means Committee.

But the move is getting a fight from the Arizona Association of Realtors. Tom Farley, the group’s chief executive officer, vows to “utilize every resource that we have here in protecting consumers.”

Under current law, if a homebuyer walks away from a house and the amount still owed is more than the value of the property, the lender cannot recover the difference from the homeowner. By contrast, owners of commercial property who stop making mortgage payments can be sued for the balance.

None of this was an issue during the red-hot days of the real estate market, when home values continued to skyrocket above what buyers paid.

But that all changed when the bottom dropped out and many homeowners found their houses were worth far less than the balance still owed on the mortgage. For many, the solution was to simply walk away and hand the keys to the bank.

The Arizona Bankers Association has fought for years to repeal or scale back the law, saying when borrowers default, that means less money available for new loans. Lenders are stuck with repossessed homes they cannot sell for enough at auction to recoup their losses. They want to be able to go after the borrowers for the difference.

But Farley, the Realtors’ advocate, said the law makes lenders more responsible.

At one time, banks and thrifts would make mortgages and then keep those in their own portfolios. Now lenders simply write the notes and sell them off, many of those to Fannie Mae and Freddie Mac, the federally backed agencies.

When the homeowners began to default, questions were raised about whether the original lenders had properly vetted the borrowers or simply wrote as many loans as they could to generate origination fees.

The law precluding them from going after homeowners “provides that pressure on the lenders to actually underwrite those loans,” Farley said.

Harper, a Republican lawmaker from Surprise, acknowledged that lenders may have ignored normal underwriting standards. But he said that’s not their fault.

“The federal government uses the Community Reinvestment Act to intimidate the federally chartered banks,” he said. “They give them goals about how many loans you have to make in underserved, low-income areas. And the banks then start making risky loans to meet the goal.”

He also said he does not believe that the banks bear some responsibility for the bad loans and should have to absorb some of the losses when borrowers default.

“The banks are taking all the risk and the buyer is taking none, other than what their down payment is,” he said.

Farley, however, said borrowers do lose more, ranging from what they’ve paid against the mortgage and the value of any improvement on the property, to dings to their credit rating.

Harper said there are situations where the value of the home is so far below what remains owed on the mortgage that there is no real chance of an owner ever catching up.

So he is willing to offer a compromise of sorts: Allow the lenders to go after the homeowner, but only up to the actual fair market value of the property.

So, in the case of a home now worth $210,000, where the remaining unpaid balance on the mortgage is $300,000, an owner would be liable only for that lower amount. The lender would have to absorb the rest.


Arizona’s laws that allow homeowners to walk away from mortgages were part of a legislative deal made in 1971, says Arizona Association of Realtors’ CEO Tom Farley.

Until then, a bank that wanted to foreclose on a home because of nonpayment on a mortgage had to go to court, a lengthy and cumbersome process.

That year, Arizona became a “deed of trust” state. The change, sought by the banks, meant lenders could foreclose on a property simply by giving notice and then taking possession 91 days later.

What the lenders gave up in exchange for that law was the ability to go after the home-loan borrowers, Farley said.

Capitol Media Services

“The banks are taking all the risk and the buyer is taking none, other than what their down payment is.”

Rep. Jack Harper,

a Republican lawmaker from Surprise


Rep. Jack Harper will introduce a bill in the next legislative session, which begins in January, to allow banks to go after homeowners who walk away from their “underwater” mortgages.

The proposal will get a hearing in a key committee, House Ways and Means, of which Harper is the chairman.

Citizens United Must Go

Independent Senator Bernie Sanders has introduced a bill to overturn Citizens United via Constitutional Amendment.  This is the Supreme Court decision (5-4) overturning precedent to hold that corporations are citizens, and giving these corporations free reign to shower our politicians with undisclosed money calling it “free speech.”  Many major cities have adopted resolutions declaring that corporations are not citizens, most recently Los Angeles.

Full article here.  Excerpt below:

Today I introduced a resolution calling for an amendment to the U.S. Constitution. A similar resolution has been offered in the house by Rep. Ted Deutsch of Florida.

I do not do this lightly nor have I ever done this before. The U.S. constitution is an extraordinary document which has served our country well for over 200 years. In my view, it should not be amended often. In light of the Supreme Court’s disastrous 5-4 decision in the Citizens United case, however, I see no alternative but a constitutional amendment.

I strongly disagree with the Supreme Court’s Citizens United decision.

In my view, a corporation is not a person.

In my view, a corporation does not have first amendment rights to spend as much money as it wants, without disclosure, on a political campaign.

In my view, corporations should not be able to go into their treasuries, spend millions and millions of dollars on a campaign in order to buy elections.

I do not believe that is what American democracy is supposed to be about.

I do not believe that that is what the bravest of the brave from our country fighting for democracy fought and died to preserve.

Almost two years ago in its now infamous Citizens United decision, the United States Supreme Court upended over a precedent, taking a somewhat narrow legal question and using it as an opportunity to radically change our political landscape, unleashing a tsunami of corporate spending on campaign ads.

Make no mistake; the Citizens United ruling has radically changed the nature of our democracy. It has further tilted the balance of the power toward the rich and the powerful at a time when the wealthiest people in this country already never had it so good. In my view, history will record that the Citizens United decision is one of the worst in the history of our country.

IRS Looking Into REMICS?

This Reuters article appeared in April of this year.  I’d like to see an update on the IRS’s review:

As of the end of 2010, investments in REMICs totaled more than $3 trillion, according to data supplied by the Securities Industry and Financial Markets Association.

In a brief statement in response to questions from Reuters, the agency said: “The IRS is aware of questions in the market regarding REMICs and proper ownership of the underlying mortgages as set out in federal tax law, and is actively reviewing certain aspects of this issue.”

The statement said the IRS would not make any further comment. An IRS spokesman declined to say anything about the extent of the review, or whether the agency is likely to take action.

The review, however, is a sign that the widespread bank misdeeds in home foreclosure cases are spilling over to threaten the interests of investors in mortgage-backed securities. The banks originated the mortgages and packaged them into securities.


$10 Trillion Problem

From an article in Salon, see

I spoke to Alan White, a visiting professor at Tulane law school who has writtenwidely on the foreclosure crisis.

A recent study by the Center for Responsible Lending found that we may be only halfway through the foreclosure crisis. Can you give us a status update on how bad things are right now?

We have this $10 trillion problem. Total outstanding mortgages in the U.S. on houses went from $4 trillion to $10 trillion – it almost tripled – in the decade before the crisis. Since 2007, mortgage debt has barely dropped. While home prices have dropped by 30 percent, the amount we owe on our houses has only dropped by 5 percent. So there’s a huge mortgage debt overhang. There are 6 or 7 million homes where people are behind on their mortgages or in foreclosure. That’s triple to quadruple any kind of levels we’ve seen since the Great Depression.

The foreclosure process is slow, and the process of working out loans one by one in our retail system has been painfully slow. We’re still foreclosing about a million more houses a year. So I think the logic of the Center for Responsible Lending report was right: When you look at all these numbers – the number of people who are behind, the rate at which we’re foreclosing on houses, and the rate at which people are being given alternatives to foreclosure, we’re looking at another five to 10 years of this.

Some Occupy protesters are starting an Occupy Our Homes campaign Tuesday on the foreclosures. They’re calling for banks to write down mortgage principal to current home values. Is anyone in Congress or Washington talking about legislative relief?

In Congress, no. President Obama made a campaign promise that he would support amending the bankruptcy code to do exactly what the protesters are calling for: reduce mortgage principal to the value of the house. He immediately backed off that promise when he got to office. The idea of realigning mortgages with home prices has met with stiff, stiff resistance from the banking industry. So far – amazingly, given the financial crisis – people in Washington and the administration and Congress have continued listening to the complaints of the industry. The fact is, we’re going to do this sooner or later. We can reduce mortgage balances to the value of homes either through the painful process of foreclosing houses, at 100,000 per month for the next 10 years. Or we could have a more systematic program and write the mortgages down for the people who are in the houses now.

The Occupy protesters are talking about eviction defenses where they block sheriff’s deputies from entering a home. Do you think this tactic will make a difference on any level?

It certainly could, if you have enough homeowners saying, “I am here. I can’t afford my mortgage, but I can afford my house.” IF enough people are involved and it’s a broad enough movement, it could bring attention to the fact that we are wastefully evicting and foreclosing and prolonging the crisis. I think it’s absolutely worth doing. The issue of writing down our mortgage debt is a very political issue. Getting the minds of the American people changed is very important. We need to stop seeing it through Rick Santelli’s eyes, and starting seeing it as an issue of helping our neighbors who are in trouble – and also helping ourselves by helping anybody who has steady income stay in their house and pay what they can rather than dumping more houses into an oversaturated market.

Turning to the Coakley lawsuit, a lot of people have the general idea that there’s been fraud in the foreclosure market but don’t understand the specifics. Can you explain?

Foreclosure lawyers have been pointing out for a while that banks didn’t have the paperwork to do the foreclosures correctly. They were foreclosing on people who weren’t behind, they were foreclosing on people who were supposed to be in loan modifications, and they were foreclosing in the name of the wrong company. There were significant false statements being made in court filings to foreclose. There have been settlement negotiations led by Tom Miller, the attorney general of Iowa, along with some of the federal agencies, that’s been going on for over a year now. A couple of the state attorneys general have now said, enough is enough, we’re not getting anywhere.

The idea is that since the industry is foreclosing in ways that are in many cases improper, there needs to be a real foreclosure prevention program and have it funded by the banks. They’ve been talking about a multi-state settlement in the $20-25 billion range. But some of the attorneys general are not persuaded that the banks are really prepared to deal with the problem. The banks have asked for releases from the states that would give them a free pass on anything they did wrong in making the loans in the first case and in foreclosing them.

How big a deal is it that some of the state attorneys general are dissenting from the idea of a comprehensive settlement?

It’s a huge deal. The direction that we’re going to go in solving the foreclosure crisis is tied up to a great extent in the ongoing state-federal regulator negotiations. If the Obama administration had a wholesale mortgage reduction program instead of this retail, one-at-a-time, painfully slow process they have – the Home Affordable Modification Program (HAMP) and the Home Affordable Refinance Program (HARP) — you could combine it with the negotiation with the banks.

There’s leftover money from TARP.  The foreclosure programs the administration designed were partly funded through the TARP bailout. And the only bailout money that hasn’t been spent is the bailout money for homeowners. You could take the unspent bailout money and combine it with the money from a bank settlement and start to make a dent in our $10 trillion problem.

Analysis of Arizona Non-Judicial Foreclosure and Title

I have excerpted the Arizona section of this article, without footnotes,  but the whole article is found here, and it is a good read.  It needs to be updated to reflect the recent In re Vasquez decision, in which the Arizona Supreme Court stated that an assignment need not be recorded prior to noticing a sale despite the language of ARS 33-411.01, but the reasoning is still valid and meaningful.


Elizabeth Renuart




A. Arizona

1. Introduction

The instrument predominantly used in Arizona to secure a debt or obligation is the deed of trust.166 Unlike a mortgage, a deed of trust is a three party instrument in which the trustor (borrower) conditionally conveys title to a third party trustee who holds it as security for the debt owed to the beneficiary (lender).167 A deed of trust vests in the trustee bare legal title sufficient only to permit it to convey the property at a non-judicial sale.168 Nonetheless, under Arizona law, there is no significant difference between a mortgage ―lien‖ and the trustee‘s ―title.‖169 For this reason, Arizona is a lien theory state.

Arizona‘s seriously delinquent foreclosure rate exceeded that of the nation as a whole leading up to and during the financial crisis. Among the nonjudicial foreclosure states, it ranks third. As of the second quarter of 2011,8.06% or 89,262 loans were seriously delinquent in Arizona.170

Source: Mortgage Bankers Association National Delinquency Survey

2. Authority to Foreclose

A power of sale provision in the deed of trust allows the trustee (or its successor) or the beneficiary to exercise the power of sale clause permitting a private sale of theproperty upon default.171 All sales or transfers of real estate or any legal or equitable interest therein must be recorded by the transferor within sixty days of the transfer.172

The beneficiary may substitute the trustee with another for any reason but the substitution must be acknowledged by all beneficiaries named in the deed of trust and recorded at the time of substitution. The beneficiary must give written notice of the substitution to the trustor.173

In Arizona, the mortgage (or deed of trust) follows the note.174 In 1938, the Arizona Supreme Court ruled that an assignment of the deed of trust without the debt transfers no right upon the assignee and is a nullity.175 Without mentioning the Hill decision and in apparent conflict with it, the intermediate appellate court recently suggested that the standards applicable to negotiable instruments regarding the right to enforce them found in Arizona‘s version of Article 3 of the UCC are irrelevant to a foreclosure sale conducted under a power of sale.176 Rather, they apply to a suit on the debt.

3. Statutorily Required Notices and Relevant Contents

The trustee shall record the notice of sale.177 The notice must contain, inter alia, the original principal balance as shown on the deed of trust; name and address of each beneficiary and of the current and original trustees; and a statement that a breach or nonperformance of the deed of trust has occurred and the nature of the breach.178 The trustee must send a copy of the notice of sale to the parties to the deed of trust at the addresses listed on the instrument within five business days after recordation. Thestatement of breach or non-performance shall be signed by the beneficiary or its agent.179

4. Effect of Defective Foreclosure

An error or omission in the information to be contained in the notice of sale under subsections (C) and (D) of section 33-808 shall not invalidate the trustee sale.180 This provision does not apply to the failure to comply with section 33-809(C) which covers the timing of the mailing of the notice of sale, to whom it must be sent, and its publication and posting. Arizona‘s Supreme Court unequivocally has held that a sale held without strictly complying with the statutory notice requirements is void.181 . Based upon the plain language of the statute, the provision should not bar a challenge to a foreclosure sale on the grounds that the trustee deed could not transfer title to the purchaser or that the beneficiary or trustee had no authority to foreclose because neither of these grounds is listed in that provision.

Once the trustee issues a deed to the purchaser following a foreclosure sale, a presumption of compliance with the contract provisions in the deed of trust and the statutory provisions in ―this chapter‖ relating to the exercise of the power of sale and theconduct of the sale arises.182 The trustee‘s deed is not conclusive, unless the purchaser is a BFP.183

These provisions are designed to ensure finality of title. In addition, section 33-811(C) instructs the trustor and certain specified parties to whom the trustee mailed a notice of the sale to bring an action seeking an injunction before 5:00 P.M. on the last business day before the scheduled sale184 Failure to do so constitutes a waiver of all  defenses and objections to the sale.185 This provision places the trustor-homeowner on as extremely short leash—either raise objections before the sale or potentially lose all rights to attack the sale. Arizona state courts have not applied this provision in the context of an attack to a completed sale based upon lack of authority to foreclose and an allegedly void sale, at least in published decisions.186 One federal judge recently sought additional briefing related to the legislative history, the effect of other provisions in section 33-811, and the statutory construction analysis that Arizona courts apply before entering a ruling.187

5. Effect of Defective Foreclosure on Bona Fide Purchasers

If the purchaser pays value without actual notice of non-compliance with the contract provisions in the deed of trust and the statutory requirements to foreclose, the trustee deed constitutes ―conclusive evidence‖ of validity.188 The trustee deed may not be conclusive where ―the notice was insufficient because of fraud, misrepresentation, or concealment.‖189 According to a federal district court, even if the trustor cannot undo the sale, she may seek damages for a wrongful foreclosure in certain circumstances.190 In another case, a federal judge refused to dismiss a quiet title action against the bank acting as trustee for the securitized trust that purchased the house at the foreclosure sale.191

6. Ibanez Traction in Arizona

Based upon this understanding of Arizona law, Ibanez may be persuasive authority in Arizona on two issues. First, like assachusetts, Arizona requires the assignment of the deed of trust to be written because it mandates recordation of the assignment within sixty days of the transfer.192 Further, in practice, most, if not all, assignments will be recorded before the sale.193 For this reason, the fact that Massachusetts is a title theory state is irrelevant to the application of the Ibanez holding in Arizona. In other words, even though the note follows the deed of trust in Arizona, assignments of the deed of trust must be recorded before the sale.

The second issue addresses the consequences of failing to possess the right to foreclose upon a completed sale. Here, both Massachusetts and Arizona require strict compliance with the power of sale clause and with additional legal requirements. The court in Ibanez voided the sale. In Arizona, the Supreme Court agreed that notice defects, at the very least, void a sale.

However, section § 33-811(C) waives all defenses the trustor may have to the sale if she fails to file an action challenging the sale by 5:00 P.M. on the day prior to the sale. If this provision cuts off the rights of homeowners to challenge the authority to foreclose following the sale, the finality of title in Arizona is absolute. If this provision does not waive authority-to-foreclose defects that void a sale, other finality provisions in Arizona law, such as the effect of the execution of the trustee‘s deed to a BFP arguably eliminatesonly objections relating to non-compliance with notice provisions in the deed of trust and specific statutory provisions.194 Challenging a sale as void on the grounds of lack of authority to foreclose may remain viable.