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Understanding a Trustee’s Deed Upon Sale

Title industry figures reveal that over the last decade forgery losses tripled, accounting now for over 20% of the losses paid by title insurers.

A Trustee’s Deed Upon Sale, also known as a Trustee’s Deed Under Sale or a Trustee’s Deed is a deed of foreclosure.  This deed is prepared after a property’s foreclosure sale and recorded in the county were the property is located.  The Trustee’s Deed transfers the property to the buyer who purchased the foreclosed property at auction.

California foreclosure law states that on the day that has been established for the sale of the property, and only after all publication period requirements have been met (NOD & NOT time periods), the property is sold to the highest bidder for cash for the full amount of the debt plus foreclosure fees and expenses. If no one bids at the Trustee’s Sale, the property automatically reverts back to the beneficiary (the bank) for the debt.

Special Note: The successful bidder of a Trustee Sale receives a Trustee’s Deed Upon Sale, which conveys full ownership of the bundle of rights but comes with no guarantee’s that the title is clean.  The property may be in default on taxes, have mechanic’s liens and/or other encumbrances.  Trustee’s deeds come with many risks and title insurance cannot be purchased to cover them.