Arizona

General Procedures and Information

Method of Issuing Title Insurance

Title agents issue title insurance policies and related forms.

Foreclosures

Foreclosures are judicial or non-judicial in Arizona.

If a foreclosure is held pursuant to a deed of trust, the process is handled non-judicially. If the foreclosure is pursuant to a mortgage, there is a judicial process. Property held pursuant to an agreement for sale, also known as contract of sale are forfeited pursuant to the notice provisions contained therein.

Non-Judicial Foreclosure (Trustee's Sale)

Arizona

Day 90 – Record Notice of Trustee's Sale at the County Recorder's Office in the county of the trust property. The notice must contain the time and place of sale and a description of the trust property. A.R.S. § 33-808 (A)(1). An error other than in the Legal Description on the Notice of Trustee's Sale is not fatal to the sale, when taken as a whole, the trust property can be located.

Day 85 – Send the Notice of Trustee's Sale via U.S. Mail along with the Statement of Breach, certified or otherwise, postage paid, to all persons on trust deed at the time of the recording of the notice of sale. A.R.S. § 33-809(C)

Day 60 – Mail to all requesting parties, and all other persons that were on the trust deed at the time of the recording of the Notice of Trustee's Sale copies of the Notice of Trustee's Sale along with the Statement of Breach A.R.S. § 33-809(B).

Day 59 – Thirty days after recordation of the Notice of the Trustee's Sale is the first day Trustee can release the following information if it is known: unpaid balance of D.O.T., liens and encumbrances at the time of recordation of the notice of trustee's sale, and names and addresses of owner(s) of the subject property at the time of the recordation of the Notice of Trustee's Sale to those who request in writing for the information. The other than for willfully and intentionally not providing the information, the Trustee assumes no liability for errors and omissions when providing such information. A.R.S. § 33-809(E)

Day 38 – The last possible day to begin publication of notice of trustee's sale in four consecutive weeks in a publication of general circulation in the county where the trust property is situated. Starting on this date will end the publishing on day 11. A.R.S. § 33-808(A)(4)

Day 20 – The last day to post notice of trustee's sale in a conspicuous place on the property if it can be posted without a breach of the peace. If it cannot be posted on the property it must be conspicuously placed at a location deemed appropriate by. A.R.S. § 33-808(A)(3)

Day 1 – Beginning at 9:00 am until 5:00 pm on the last business day preceding the day of sale and beginning 9:00 am until the time of the sale on the day of sale the trustee must provide to whom ever requests it, the actual bid price or the credit bid the beneficiary is entitled to make the sale. The trustee assumes no liability for accuracy or omissions when providing this information, and may respond to oral requests at this time. Further, the trustee may charge a fee no more than 5% of that allowed by A.R.S. 33-813(B)(4) for providing said information, but may charge no more than $100.00 and is not required to accept less than thirty dollars. The trustee may accept less at its discretion. If the information cannot be provided within this time period the sale must be postponed until the information can be provided per this subsection. A.R.S. § 33-809(F)

Day 0 – Conduct the trustee's sale by a public auction at the time and place designated for the sale on the Notice of Trustee's Sale. The attorney for the trustee or an agent for the trustee may bid at the auction. However, only the beneficiary may make a credit bid in lieu of cash at sale. A $10,000.00 deposit in cash, or cashier's check, is required of every bidder except the beneficiary to enter the bid. The trustee cannot refuse cash as a form of the bidder's deposit. Every bid is deemed irrevocable until the end of the sale unless a bidder enters a subsequent higher bid than there previous one. Once the sale is completed, the trustee must return the deposits to the unsuccessful bidders. The sale is deemed completed when the highest bidder tenders payment to the satisfaction of the trustee. The recordation of the trustee's deed is a ministerial act. The trustee's sale is deemed perfected at the date and time of the sale if the trustee's deed is recorded in the county of the subject property within 15 days of the date of the sale. A.R.S. § 33-810 (A)

Day +1 – Highest bidder must pay no later than 5:00 pm the following day other than a Saturday or legal holiday. If the highest bidder does not pay the trustee, the trustee, at their discretion, may continue the sale or offer the property to the second highest bidder. The deposit of the highest bidder is kept by the trustee and considered additional proceeds of the sale. This process may continue until the property is sold. A.R.S. § 33-811 (A)

Day +1 or greater – Pursuant to A.R.S. § 33-811(C) The trustor, its successors or assigns, and all persons to whom the trustee mails a notice of a sale under a trust deed pursuant to section 33-809 waives all defenses and objections to the sale not raised in an action that results in the issuance of a court order granting relief pursuant to Rule 65, Arizona Rules of Civil Procedure. The order must be entered before 5:00 p.m. mountain standard time on the last business day before the scheduled date of the sale. A copy of the order, the application for the order and the complaint must be delivered to the trustee within twenty-four hours after entering the order.

For specific questions, contact Arizona underwriting personnel.

Corporate Directory: Arizona Contacts .

Redemption Rights

No information is available.

Survey Standards

Stewart Title Guaranty does not require a survey for deletion of the survey exception on real estate transactions involving 1-4 residential properties or commercial properties with liabilities of $10 million or less. The 1-4 residential properties must be subdivision acreage or acreage tracts of twenty-five acres or less.

References
Related Bulletins:

MU000028   Survey Requirements - Loan Policies

MU000038   This Bulletin has been replaced by MU2007002.

Document and Form Information

Acknowledgments

These are the standard forms of acknowledgment used in Arizona pursuant to Arizona Revised Statutes 33-506:

  • AZ Acknowledgment-Individual 1
  • AZ Acknowledgment-Corporation 1
  • AZ Acknowledgment-Partnership 1
  • AZ Acknowledgment-Attorney-in-Fact 1
  • AZ Acknowledgment-Public Official, Trustee or Personal Representative 1

Conveyances

The customary form of conveyance is the AZ Deed-Warranty 1.

Other common forms of conveyances include the following:

  • AZ Deed-Warranty (Special) 1
  • AZ Deed-Warranty (Joint Tenancy) 1
  • AZ Deed-Warranty (Special Joint Tenancy) 1
  • AZ Deed-Community Property With Right of Survivorship (Warranty) 1
  • AZ Deed-Community Property With Right of Survivorship (Special Warranty) 1
  • AZ Deed-Community Property With Right of Survivorship (Special Warranty) 2
  • AZ Deed-Quitclaim 1
  • AZ Deed-Community Property With Right of Survivorship (Quitclaim) 1
  • AZ Deed-Disclaimer 1

Corresponding affidavits are:

  • AZ Affidavit-Acceptance of Joint Tenancy 1
  • AZ Affidavit-Acceptance of Community Property With Right of Survivorship 1

Witnesses are not required on conveyances.

Pursuant to Arizona Revised Statutes 33-411, an instrument properly executed and acknowledged in accordance with the laws of another state will be entitled to record as if executed in Arizona.

Releases/Satisfactions

The standard release or satisfaction forms in Arizona are:

  • AZ Satisfaction of Mortgage 1
  • AZ Deed of Release and Reconveyance (Trustee) 1
  • AZ Deed of Release and Reconveyance (Beneficiary) 1

Security Instruments

The customary security instrument is the Deed of Trust. However, mortgages and agreements for sale (contract of sale) are also used.

Witnesses are not required on mortgage instruments executed in Arizona.

Pursuant to Arizona Revised Statutes 33-411, an instrument properly executed and acknowledged in accordance with the laws of another state will be entitled to record as if executed in Arizona.

Title Insurance Form Regulations

Title insurance forms and endorsements must be filed with the State Insurance Department. Although the ALTA policy forms and endorsements are the most commonly used forms, other types of endorsements may be used if they have been filed properly with the Insurance Department.

References:

Forms List : Arizona Forms.

Fees, Rates and Taxes

Deed Transfer Taxes and Documentary Stamps

Arizona does not have deed transfer taxes or documentary stamps. However, an affidavit of real property value must be completed and submitted with any deed to be recorded.

References:

Related Bulletins: None.

Mortgage Transfer Taxes

Arizona does not have a mortgage tax.

Real Estate Taxes

Real estate/ad valorem taxes are due in two installments in Arizona. The first installment is due October 1st and is delinquent on November 1st. The second installment is due March 1st and is delinquent on May 1st.

Recording Fees

Recording fees for a document are $9.00 for the first five pages and $1.00 for each additional page.

Search and Examination Fees

Search and examination fees are included in the premium.

Title Insurance Rates

Rates are filed with the State Insurance Department.

The seller customarily pays for the owner's title policy and the purchaser/borrower pays for the loan policy.

For specific questions, contact Arizona underwriting personnel.

References:

Corporate Directory: Arizona Contacts .

Spousal Rights

Spousal Rights

Arizona is a community property state. A.R.S. 25-201

Statute Of Limitations

No information is available.

Ask the TITLEMAN™

2006 Publications

Ask the TITLEMAN™

John T. Lotardo aka the TITLEMAN™ is Senior Vice-President/General Counsel for Stewart Title & Trust of Phoenix, Inc, State Underwriting Counsel for Stewart Title Guaranty Company and is a regularly featured columnist. In addition, he is a frequent speaker and presenter on real estate-related topics. Have any questions for him? Send it to him at titleman@askthetitleman.com or you can visit www.askthetitleman.com.

Publication Archives

John T. Lotardo aka the TITLEMAN™ is Senior Vice-President/General Counsel for Stewart Title & Trust of Phoenix, Inc, State Underwriting Counsel for Stewart Title Guaranty Company and is a regularly featured columnist. In addition, he is a frequent speaker and presenter on real estate-related topics. Have any questions for him? Send it to him at titleman@askthetitleman.com or you can visit www.askthetitleman.com.

Real Estate Practices

Attorney Involvement

Please describe any requirements under applicable state law for attorney, abstractor or other special professional involvement, for example, in the search, examination, opinion of title, signing, closing, disbursement, recording, preparation of documents, and/or policy-issuance.

Arizona state law does not require attorney or abstractor involvement; however policies must be issued by a licensed issuing agent with Dept. of Insurance with an Arizona licensed title insurer. Arizona Revised Statutes requires, among other things, that you must maintain a title insurance plant for any county (that you issue a title insurance policy) that has over 100,000 people based upon that last decennial census. The link for Arizona Department of insurance is: http://www.id.state.az.us/index.html.  Title plant maintenance includes being a lessee or joint owner of a title plant. Alternatively, you may base your title policy on a title policy issued to you from a title insurer who does maintain such a title plant in the respective county or counties.

Cancellation/Commitment Fee

Does your state permit or require a cancellation fee or commitment fee upon cancellation?

Arizona permits, but does not require, a cancellation/commitment fee.

Certificate of Release (of Mortgage)

If anyone other than the lender (such as a title agent, settlement agent, underwriter or attorney) has the authority to release the security instrument, please describe.

Title insurer has statutory authority to release subject to the requirements in A.R.S. 33-707.

Deeds

Please describe the kinds of deeds that are customary for commercial and residential transactions.  Please describe the kinds of deeds that are generally not insurable.

Warranty Deeds and Special Warranty Deeds are generally used. Quit Claims are generally not used in sale transactions and are generally not insurable, but would be reviewed on a case-by-case basis.

Joinder of Spouses

If a non-title holding spouse is required to join in the execution of a deed or a security instrument, please describe.  Any analogous rights, such as those in a civil union or equivalent, should also be addressed. 

State law does not require joinder, but the lender sometimes requires non-title holder spouse to sign as such. Arizona does not recognize civil unions or equivalent.

Mortgage Tax

Is there a mortgage tax in your state?  If yes, is it uniform across the state or does it vary?  If it is uniform, please describe.  

No.

Payment Customs

Who customarily pays for:

(a) Owner’s Policy?
(b) Transfer Tax & Recording Fee?
(c) Survey Charges?
(d) Closing/Settlement Fees?

(a) Owner’s policy: typically, seller
(b) Transfer tax and recording fee: usually split depending on agreement
(c) Survey charges: usually split depending on agreement
(d) Closing/settlement charges: usually split depending on agreement

Policy Countersignatures

Please describe any statutory or regulatory requirements for countersignatures in order to issue the policy (for example, residency requirements).

Countersigned by the issuing agent.

Real Estate Taxes

Please describe the general tax year, due dates, and delinquency dates, including lien dates and payment cycle.

Real estate taxes are paid in two installments. The first installment of one-half taxes is due Oct. 1 (delinquent after Nov. 1) and the second installment of the remaining one-half is due the following March 1 (delinquent after May 1). Thereafter, subject to sale the following year. By state law interest is assessed at 16% per annum prorated monthly. If the taxes, penalties and interest are not paid in full within 13 months, an advertising fee of 5% or $5.00, whichever is greater, is assessed and during the sixteenth month the Treasurer's Office offers a tax lien on the property for sale. If the tax lien is not redeemed within three years from the date of sale, the purchaser may initiate foreclosure proceedings.  See: http://treasurer.maricopa.gov/

Please consult with a local underwriter for additional information relating to real estate taxes on the subject property.

Search and Examination Fees

Is it permissible and/or customary to charge a separate search and/or examination fee, and under what circumstances?  If your jurisdiction is all-inclusive, please state that.

While not typically charged, they are charged on occasion if special searches are done.

Search Requirements

Is there a minimum period of time for a title search required: (a) by state law, (b) pursuant to marketable record title acts, or (c) by any other applicable title examination standards (e.g., state bar association)?  Please respond to each category.  If a minimum search period exists for any category, please state it.

(A) There is no state law requiring a minimum period of time for a title search but a title plant must typically have a minimum 40 year chain;
(B) There is not a marketable record title act;
(C) No other applicable state requirements.

Security Instruments (Deed of Trust vs. Mortgage)

Please describe the customary and permissible form(s) of security instruments used in your state. 

Who can be listed as the trustee on the Deed of Trust (e.g., residency and/or natural person requirements, etc.)? Can an underwriter or title agent be designated as the trustee, and, if so, is it customary?

Deeds of trusts are used typically. Mortgages are rarely used, but can be used.

Standard Exceptions and Requirements

Please identify the standard exceptions and requirements that are customarily used in your state.

AZ utilizes the Stewart standard exceptions:

Rights or claims of parties in possession not recorded in the Public Records.

Easements or claims of easements not recorded in the Public Records.

Any discrepancies, conflicts or shortages in area or boundary lines, or any encroachments or protrusions, or any overlapping of the improvements.

Any lien, or right to a lien, for services, labor, material or equipment, heretofore or hereafter furnished, imposed by law and not recorded in the Public Records.

Taxes or assessments which are not recorded as existing liens in the Public Records.

State-specific Policy Variations

If there are state-specific changes to the provisions in the ALTA policies (e.g., Arbitration, Minerals), please describe.

The policies are the same. Please consult a local underwriter for information relating to any special endorsements that may be offered in the state.

Title Insurance Form and Filing Regulations

Please describe the form and/or rate filing requirements, if any, related to policies and endorsements.  Please describe any applicable rating bureau. 

Arizona Department of insurance is the governing body where both rates and forms are filed. See their website for requirements http://www.id.state.az.us/index.html.title.

Transfer Taxes

Is there a transfer tax in your state? If yes, is it uniform across the state or does it vary?  If it is uniform, please describe.

No.

Usury

Is usury coverage available?

Yes, a usury endorsement is available.  The statutory maximum rate of interest is 10% per annum, unless a different rate is contracted for in writing, in which case any rate of interest may be agreed upon.  ARS 44-1201. 

Usury also constitutes a misdemeanor crime.  ARS 13-2208.

Withholding Taxes

What are your state’s requirements, if any, with regard to withholding proceeds from a sale, similar to but not including FIRPTA?

Arizona has no state withholding requirements in addition to FIRPTA.

Witness Requirements

Are witnesses required on a deed or security instrument?  If so, please describe.

Notarized only; no witnesses are typically required unless the notarization requires it, such as person executing is blind, marks with an X.

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