(1) |
As used in this section:
Terms Used In Utah Code 78B-2-313- action: as used in this chapter includes counterclaims and cross-complaints and all other civil actions in which affirmative relief is sought. See Utah Code 78B-2-101
- Deed: The legal instrument used to transfer title in real property from one person to another.
- Fraud: Intentional deception resulting in injury to another.
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Person: means :Utah Code 68-3-12.5
- Property: includes both real and personal property. See Utah Code 68-3-12.5
- State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
(a) |
“Deficiency” means the balance owed to a secured lender under a secured loan after completion of a short sale of the secured property. |
(b) |
“Obligor” means the person or persons obligated to pay a secured loan. |
(c) |
“Secured lender” means the person or persons to whom the obligation under a secured loan is owed. |
(d) |
“Secured loan” means a loan or other credit for personal, family, or household purposes secured by a mortgage or trust deed on secured property. |
(e) |
“Secured property” means single-family, residential real property located in the state that is the subject of a mortgage or trust deed to secure a secured loan. |
(f) |
“Short sale” means a sale:
(ii) |
by the owner of the secured property; |
(iii) |
that results in the secured lender being paid less than the balance owing under the secured loan; and |
(iv) |
made with the secured lender’s consent and resulting in the secured lender releasing the mortgage or reconveying the trust deed on the secured property. |
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(2) |
An action to recover a deficiency is barred unless it is commenced no more than three months after the date of recording of a release of mortgage or reconveyance of trust deed with respect to secured property and resulting from a short sale of that property. |
(3) |
Subsection (2) does not apply if the obligor or owner engaged in fraud in connection with the short sale. |
(4) |
Subsection (2) does not apply to an agreement that:
(a) |
is executed:
(i) |
between one or more obligors under a secured loan and the secured lender; and |
(ii) |
in connection with a short sale; and |
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(b) |
obligates an obligor to pay some or all of a deficiency. |
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Amended by Chapter 278, 2013 General Session