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<p class="MsoNormal"><span style="color:#002060">Dear All:<o:p></o:p></span></p>
<p class="MsoNormal"><u><span style="color:#002060">Here is the scenario</span></u><span style="color:#002060">:<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="color:#002060">Owner has a loan with Lender 1 evidenced by a Promissory Note and a Deed of Trust on Property A. Owner also has a loan with Lender 2 evidenced by a Promissory Note (and a questionable
Deed of Trust on Property A). Property A is located in a community subject to continuing liens and assessments of an HOA.<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="color:#002060">Owner defaults on both loans. Lender 1 initiates nonjudicial foreclosure proceedings and Property A is sold at a trustee sale. Surplus proceeds from the sale are deposited with the
Court. Notice of the deposit is given to Owner and to 3 financial institutions, each arguably holding a security interest in Property A. However, notice of the deposit is
<u>not</u> given to the HOA that has a continuing lien on Property A with, of course, an outstanding balance due.<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="color:#002060">Lender 2 brings a motion before the Court to disburse funds to collect on its defaulted Promissory Note, declaring that it has a security interest in Property A by way of a 2<sup>nd</sup>
position Deed of Trust. The Court grants the motion and the balance of the surplus funds are disbursed to Lender 2.<o:p></o:p></span></p>
<p class="MsoNormal"><u><span style="color:#002060">Here is the problem</span></u><span style="color:#002060">:
<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="color:#002060">The Deed of Trust for Lender 2 is faulty. The Deed of Trust does contain the correct parcel number for Property A and references the correct street address. However, both the abbreviated
legal description on page 1 of the Deed of Trust and the full legal description on Exhibit A to the Deed of Trust describe some other real property located in Pierce County, Washington – neither of the legal descriptions describe Property A at all.
<o:p></o:p></span></p>
<p class="MsoNormal"><u><span style="color:#002060">Here are my questions</span></u><span style="color:#002060">:<o:p></o:p></span></p>
<ol style="margin-top:0in" start="1" type="1">
<li class="MsoListParagraph" style="color:#002060;margin-left:0in;mso-list:l0 level1 lfo1">
Are the improper legal descriptions fatal to the enforceability of Lender 2’s Deed of Trust as against Property A?<o:p></o:p></li><li class="MsoListParagraph" style="color:#002060;margin-left:0in;mso-list:l0 level1 lfo1">
Does Owner or the HOA have any recourse against Lender 2 to recover amounts that may have been improperly disbursed to Lender 2?<o:p></o:p></li><li class="MsoListParagraph" style="color:#002060;margin-left:0in;mso-list:l0 level1 lfo1">
Is the applicable statute of limitation 3 years for bringing an action against Lender 2 to recover those amounts? (The surplus funds were deposited in February 2022 and disbursed in March 2022)<o:p></o:p></li></ol>
<p class="MsoNormal"><span style="color:#002060">In advance, thanks for your help in sorting this out.<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-bottom:12.0pt"><b><span style="color:#002060">Mark B. Anderson<br>
</span></b><span style="color:#002060">ANDERSON LAW FIRM PLLC<br>
821 Dock St Ste 209 PMB 4-12<br>
Tacoma, Washington 98402<br>
+1 253-327-1750<br>
+1 253-327-1751 (fax)<br>
<a href="mailto:marka@mbaesq.com"><span style="color:#002060">marka@mbaesq.com</span></a><br>
<a href="http://www.mbaesq.com/"><span style="color:#002060">www.mbaesq.com</span></a><b><o:p></o:p></b></span></p>
<p class="MsoNormal" style="margin-bottom:12.0pt"><b><span style="font-family:"Arial Narrow",sans-serif;color:#002060">CONFIDENTIALITY NOTICE<br>
</span></b><span style="font-family:"Arial Narrow",sans-serif;color:#002060">This transmission is confidential and is intended solely for the use of the individual named recipient. It may be protected by the attorney-client privilege, work product doctrine,
or other confidentiality protection. If you are not the intended recipient, or the person responsible to deliver it to the intended recipient, be advised that any dissemination, distribution, or copying of this communication is prohibited. If you have received
this transmission in error, please immediately notify the sender via e-mail or by telephone at (253) 327-1750 that you have received the message in error, and then delete it. Thank you.<o:p></o:p></span></p>
<p class="MsoNormal"><o:p> </o:p></p>
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