Please choose a term from below:

Borrower – for our purposes, the person who is obligated on the deed of trust. May also be referred to as the "trustor" or "mortgager".

Deed of Trust – what we foreclose. Sometimes loosely referred to as a mortgage because it serves the same purpose and "mortgage" is shorter than "deed of trust." Both are intended to provide security for a loan, in other words to give the lender a way to get paid beyond the borrower’s promise to repay. The deed of trust differs from a mortgage in that it can be foreclosed non-judicially, while a mortgage must be foreclosed through a lawsuit. Technically, the borrower transfers the property into a trust for the benefit of the lender, and in the event of a default the trustee of this trust forecloses the deed of trust.

Due on Sale Clause - a clause contained in some deeds of trust that allows the beneficiary of the deed of trust to declare the entire loan balance due if the property or a part of it is transferred to a new owner without the beneficiary’s consent.

Foreclosure Auction – in the absence of a reinstatement or payoff, the foreclosure process ends with a sale of the property at a public auction at the courthouse. Anyone may bid at the auction, although they may be required to prove that they have the funds with which to bid. The beneficiary may bid without funds up to the amount that is owed on the deed of trust (an "offset bid," because it simply offsets what the beneficiary is owed). If there are third-party bidders and the beneficiary wants to acquire the property, then he/she/it will have to put up cash in the amount by which the bid exceeds the amount of the debt.

Foreclosure process – the series of steps required by law to transfer the ownership of the property to satisfy the debt. With a deed of trust, there are two possible foreclosure processes, judicial and non-judicial. The judicial foreclosure process involves filing a lawsuit in state court, seeking a money judgment for the amount owed and an order permitting the sale of the property at auction. The non-judicial process involves the recording of a notice of default ("NOD") in the real property records, posting the NOD on the property and mailing it to anyone with an interest in the property, publishing and posting a public notice of the foreclosure sale, and then holding an auction sale at the place, date and time set for the sale in the NOD.

Foreclosure Title Report – a foreclosure title report is obtained in connection with the non-judicial foreclosure process. It shows who owns the property, the legal description of the property, the liens against the property, and the names and addresses of the persons entitled to notice of the foreclosure. Click HERE to view a sample title report

Eviction – under either type of foreclosure, the winning bidder at the foreclosure auction is entitled to possession of the property. However, if the occupant does not leave voluntarily after receiving a notice to vacate the property, the bidder must bring a court action to evict the occupant. This involves filing a lawsuit, serving the occupant with the summons and complaint, and holding a hearing before a judge. The judge will then determine whether the bidder is entitled to possession (usually yes), and how long the occupant has to leave. The court will issue a judgment for possession of the property, and a writ of assistance that the bidder can use to have the State Troopers escort the occupant off the property if the occupant does not leave by the end of the time allowed by the judge.

Lender – for our purposes, the beneficiary of the deed of trust, sometimes also called the "mortgagee." The one who is owed money or some other obligation by the borrower/trustor, and who is entitled to foreclose the deed of trust if the obligation is not satisfied.

Lien - an interest in property to secure the payment of a debt or performance of an obligation. If the owner of the property does not satisfy the debt or perform the obligation, the one to whom the debt or obligation is owed, and who holds the lien interest, may foreclose the lien and take the property to sell to pay the debt or obligation. Liens may be non-consensual (meaning the property owner did not consent to have the lien attach to the property) such as a judgment lien or tax lien, or consensual (the owner did consent) such as a mortgage or deed of trust.

Notice of Default – the document that is recorded in the real property records to mark the formal start of the foreclosure process, thereby giving notice to all that the property is in foreclosure. The Notice of Default (or “NOD”) must contain information about the deed of trust being foreclosed, the legal description and street address of the property, and the date, time and place of the foreclosure sale auction. The NOD must also be mailed to all persons with an interest in the property that might be affected by the foreclosure, and delivered to the occupant of the property or posted on the property. In Alaska, the first legal action in the foreclosure process is the recording of the NOD.

Non-Judicial Foreclosure – a remedy allowed by Alaska Statutes to sell property through an auction in cases where the borrower (a/k/a mortgager, trustor, payor) defaults on the promise to his lender (a/k/a mortgagee, beneficiary, payee) to make payments on the loan, when the loan is secured by a deed of trust on real property.

Payoff – the option to pay in full the debt secured by the deed of trust, including the entire principal balance, accrued interest, late fees, foreclosure fees and costs, etc. This not only stops the foreclosure, but also gives the owner of the property the right to have the deed of trust reconveyed or removed from the title for the property.

Reinstatement – the option to cure the payment default that gave rise to the foreclosure by paying the sum of the payments in default, any late charges, fees and costs for the foreclosure, and any other advances made by the beneficiary pursuant to the terms of the deed of trust, such as taxes and insurance on the property. Reinstatement stops the foreclosure process, at least for the first two times that the deed of trust is in foreclosure, and assuming that there are no other defaults involved, such as a due on sale clause violation.

Security Interest - a lien on the property that the owner of that property gives to secure payment of a debt. A deed of trust creates a security interest in real property; a security agreement is used to create a security interest in personal property such as a car or mobile home. This type of lien is created by agreement, unlike a judgment lien, although if foreclosed judicially the deed of trust is then is converted to a judgment lien.

Trustee – one who holds property in trust for the benefit of another. Ownership of property can be broken down into the legal title to the property, and the beneficial interest. Legal title means about what you’d expect, the formal ownership interest such as what would show up in the real estate records. Beneficial interest means the actual benefits of ownership, such as the right to receive income from the property or to use the property in some way. A trustee receives the legal title, the beneficiary has the beneficial interest. A deed of trust is just barely considered a trust, so while the names are used, the trustor is treated as really still owning the property, the trustee does virtually nothing, and the beneficiary’s beneficial interest becomes active only in the event of a default. Under the foreclosure statute, the trustee must sign the Notice of Default, and the Trustee’s Deed for the foreclosure.