Steps to Foreclosure in Nevada
When the borrower of a mortgage loan is unable to meet the financial terms in the contract, the lending agent has the right to reclaim the property and sell it to the highest bidder. This is referred to as a foreclosure. The foreclosure process in Nevada generally takes 120 days to complete.
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Title Theory
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Nevada's foreclosure laws are influenced by the title theory of property ownership. This theory states that the lending agent owns any property that is secured by a mortgage loan. The trust deed is the document that confers ownership to the lender for the duration of the loan.
Foreclosure Methods
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Nevada allows two methods to foreclose on delinquent loans. The judicial method forces the lender to obtain a court order to foreclose on the property. When this request is filed, the court usually gives the borrower a deadline to make the necessary payments. Once this deadline passes, the court orders the home to be sold at auction. The lender also has the option to include a power of sale clause in the mortgage contract. This clause allows the lender to foreclose on the property, if the loan is in default, without the need for a court order. This is referred to as the nonjudicial foreclosure method.
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Power of Sale
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The power of sale clause usually states any requirements for the completion of the foreclosure process. If any of the necessary information is missing, then Nevada's regulations will take effect. The lender must file a notice of foreclosure with the county in which the property is located. A copy of this notice must be mailed, on the same day, to the borrower via certified mail.
Deficiency
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If the auction yields a lower price than the balance due on the mortgage loan, then a deficiency has occurred. The lending agent may file a lawsuit against the borrower for payment of this deficient amount, as long as he does so within three months of the auction.
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