Pub. 11 2021 Issue 1

14 www.azbankers.org it clear to the borrower that the lender has accelerated the loan. Also, filing a judicial foreclosure complaint is an affir - mative act of acceleration of a loan. On Jan. 14, 2021, the Arizona Court of Appeals held “that absent an express statement of acceleration in the notice of trustee’s sale, or other evidence of an intent to accelerate, recording a notice of trustee’s sale, by itself, does not accel- erate a debt.” Bridges v. Nationstar Mor tgage, L.L.C., 2021 WL 126562 (AZ App. 2021). See also, Base-line Finan- cial Services v. Madison, 229 Ariz. 543, 545, 275 P.3d 321, 323 (AZ App. 2012) (even if a contract permits acceleration of a loan without notice, the lender must perform an unequivocal act demonstrat- ing it has exercised the loan acceleration clause); and Andra Miller Designs LLC v. US Bank NA, 244 Ariz. 265, 270, 418 P.3d 1038, 1043 (AZ App. 2018), review denied (July 3, 2018) (“to exercise its op- tion to accelerate a debt, the creditor must undertake some affirmative act to make clear to the debtor it has accelerated the obligation”). 10. Does recordation of a Notice of Trustee’s Sale by itself serve as an act to accelerate an un-matured install- ment promissory note? Short answer: No. The simple act of recording a Notice of Trustee’s Sale, by itself, is not an affirmative act to accel - erate the loan. The loan must be accel- erated in writing by a separate notice of acceleration or by including language in the Notice of Trustee’s Sale that the loan has been accelerated. On Jan. 14, 2021, the Arizona Court of Ap- peals held “that absent an express statement of acceleration in the notice of trustee’s sale, or other evidence of an intent to accel- erate, recording a notice of trustee’s sale, by itself, does not accelerate a debt.” Bridges v. Nationstar Mortgage, L.L.C., 2021 WL 126562 (AZ App. 2021). Larry Folks Folks Hess, PLLC 1850 N. Central Ave., Suite 1140 Phoenix, Arizona 85004 602-256-5906 (direct line) folks@folkshess.com www.AzDefaultLegalServices.com continued from page 13 11. Can a lender de-accelerate a loan for the purpose of application of the statute of limitations? Short answer: Yes. The lender can de- accelerate a loan by stating in writing that the acceleration of the debt is withdrawn or revoked. See, Andra Miller Designs LLC v. US Bank NA, 244 Ariz. 265, 271, 418 P.3d 1038, 1044 (AZ App. 2018), review denied (July 3, 2018). 12. Does the act of a lender internally “charging off” a loan have any impli - cation concerning whether or not an installment loan evidenced by a prom- issory note has been accelerated for the purpose of calculating the statute of limitations? Short answer: No. “Charging-off” a loan is an internal bank accounting measure. It is not an affirmative act to exercise the optional acceleration clause of a loan. See, Baseline Financial Services v. Madi- son, 229 Ariz. 543, 545, 275 P.3d 321, 323 (AZ App. 2012) (charge-off of a loan is an “accounting procedure within the bank” and not an affirmative exercise of the op - tional acceleration clause). 13. What is the statute of limitations applicable to a defaulted contract for sale, such as a retail installment con- tract for the sale of a motor vehicle? Short answer: Four years. A.R.S. §47-2725(A) of the Arizona Uniform Commercial Code (“UCC”) imposes a four- year statute of limitations for suits based upon a defaulted contract for sale, which typically concerns a retail installment contract for the sale of a motor vehicle. Baseline Financial Services v. Madison, 229 Ariz. 543, 544, 275 P.3d 321, 322 (AZ App. 2012). Additionally, a lender’s repossession of a motor vehicle is an affirmative act suffi - cient to exercise the optional acceleration clause of a retail installment sales contract concerning the sale of a motor vehicle. Id. at 546 and 324 citing Wheel Estate Corp. v. Webb, 139 Ariz. 506, 508, 679 P.2d 529, 531 (AZ App. 1983). 14. What is the statute of limitations that applies to a mortgage deficiency lawsuit following a lender’s non- judicial trustee’s foreclosure sale of real property? Short answer: 90 days. A.R.S. §33-814(A) and (D) require that a creditor commence an action to recover a mortgage deficiency within ninety (90) days after the date of the non-judicial trustee’s foreclosure sale of the subject real property. Failure to file a deficiency lawsuit within the 90-day period results in the proceeds of the sale, regardless of amount, being deemed to be full satisfaction of the obli- gation and no right to recover a deficiency in any action shall exist. Furthermore, this statute of limitation is a statute of repose, meaning that it is an absolute bar date against filing a mortgage deficiency lawsuit after the 90-day post-foreclosure sale peri- od expires. In re Wright, 486 B.R. 491, 502 (Bankr. AZ 2012) citing Resolution Trust Corporation v. Olson, 768 F. Supp. 283 (D. Ariz. 1991).