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estate being foreclosed is located. Although anyone can bid at a foreclosure sale,the normal <br /> result of the foreclosure sale is that the lender bids in the debt without competing bidders, <br /> and purchases the mortgaged property from the defaulting borrower through the sheriff, <br /> subject to the rights of the borrower and subsequent creditors to redeem. <br /> The holding of such foreclosure sale starts the period of redemption running. The <br /> period of redemption will normally be six months but can be as long as twelve months. <br /> During the period of redemption, the mortgagor normally retains the right to remain in <br /> possession of the mortgaged property without making mortgage payments or paying real <br /> estate taxes(subject to the mortgagee's rights to the assignment of leases and rents). During <br /> the period of redemption, the mortgagor has the right to pay off the entire indebtedness, <br /> including full principal, accrued interest, any amounts reasonably paid by the mortgagee to <br /> preserve the security,and attorney's fees and disbursements to the extent allowed by statute. <br /> If a receiver is appointed under the assignment of rents provision of a mortgage, such <br /> receiver will collect all rents and revenues during the foreclosure proceedings. See "The <br /> Mortgage -- Assignment of Leases and Rents" in Appendix A. <br /> After the period of redemption expires,the mortgagee is entitled to possession of the <br /> premises, but may have to bring an unlawful detainer proceeding to enforce its possessory <br /> rights, and a proceeding subsequent in the case of Torrens property to perfect its title to the <br /> mortgaged property. <br /> It is not unusual, therefore, for a mortgagee to be delayed for up to 10 months or <br /> longer from the date of initiation of the mortgage foreclosure proceeding until it realizes its <br /> possessory rights. <br /> Reliance on the Mortgage and the Subordinate Mortgage as a Remedy <br /> The Borrower will execute the Mortgage and the Subordinate Mortgage on the <br /> Project in favor of the City to secure the Borrower's obligations pursuant to the Loan <br /> Agreement. The City will assign its interest in the Mortgage and the Subordinate Mortgage <br /> to the Trustee. Because the Borrower has limited financial assets other than the Project, if <br /> there is a default under the Indenture, the primary remedy of the Trustee is to foreclose on <br /> the real and personal property security granted pursuant to the Mortgage and the Subordinate <br /> Mortgage. Under certain circumstances, such as a payment default on a series of Bonds,the <br /> Trustee has the right to foreclose on the Borrower's leasehold interest in the land on which <br /> the Project is located and to pursue remedies under the Uniform Commercial Code with <br /> respect to the Project. All amounts collected upon foreclosure of the Project pursuant to the <br /> Mortgage and the Subordinate Mortgage are to be used to pay certain costs and expenses <br /> incurred by, or otherwise related to, the foreclosure, the performance of the Trustee and/or <br /> the beneficiary under the Mortgage and the Subordinate Mortgage,and then to pay amounts <br /> owed under the Indenture in accordance with the provisions of the Indenture. <br /> Any valuation of the Project is based on future projections of income, expenses and <br /> capitalization rates throughout the term of the Ground Lease. Additionally,the value of the <br />