HomeMy WebLinkAboutOrder 055 - Due-Payable on PropertyDeschutes County Board of Commissioners
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AGENDA REQUEST & STAFF REPORT
For Board Business Meeting of July 22, 2009
Please see directions for completing this document on the next page.
DATE: July 15, 2009.
FROM: Laurie Craghead Legal 388 -6593
TITLE OF AGENDA ITEM:
"Consideration of Board Signature of Order No. 2009 -055 - Declaring All Sums Immediately Due aid
Payable Owed by Morgan Reed Pursuant to Promissory Note, Document No. 2007 -154, and Trust
Deed.
PUBLIC HEARING ON THIS DATE? No
BACKGROUND AND POLICY IMPLICATIONS:
At the March 2007 county auction, Morgan Reed was the winning bid for a lot in Oregon Water
Wonderland Unit 2. At that time, Mr. Reed executed a promissory note secured by a trust deed. Mr.
Reed failed to make any payments on the promissory note since November 2008 and failed to pay the
2008 -2009 real property taxes. Either failure results in a default of the promissory note and trust deed.
The quickest way to foreclose Mr. Reed's interest in the property is a non judicial foreclosure by
advertisement and sale of the property. An order by the Board declaring the default and all sums du
and payable is necessary to initiate the process.
At the sale, the county's opening bid should be the county's remaining lien interest in the property,
including the interest and late fees owed by Mr. Reed. By bidding that much at the sale, any other
person interested in the property will have to bid higher, thus, assuring the county receives all that is
owed the county under the loan. If no other person bids higher than the county, the county will be
issued the trustee's deed.
One issue that may limit outside interest in the property from other bidders is a 2006 judgment lien c n
the property that has priority over the county's lien interest. Assuming without knowing that no
payments have been made on that judgment lien, with the statutory 9% interest, the amount to remove
that lien would be about $2400. Legal Counsel's office is awaiting a fax from the creditor with the Pay -
off information. That lien interest does not have to be paid until after the foreclosure sale because any
sale would be subject to that lien.
In order not to have to return to the Board for further authorization to complete the foreclosure and
removal of the judgment lien, the order includes authorization to bid the county's lien interest at the
auction and to pay the judgment lien if the county is the winning bidder at the sale.
FISCAL IMPLICATIONS:
The fiscal costs are the cost of the county staff in engaging in the foreclosure proceedings.
Additionally, if the county is the winning bid at the auction, in order to clear the title of the property,
the county will have to pay the above mentioned judgment lien. Of course, the county has Mr. Reed's
down payment and monthly payments through October 2008 that exceed the amount the county will
have to pay to remove that lien.
The fiscal gain is that the county will receive what it is owed on the contract or receive the property 10
resell when the market improves
RECOMMENDATION & ACTION REQUESTED:
Staff recommends the Board approve and sign Order 2009 -055
ATTENDANCE: Teresa Rozic & Laurie Craghead
DISTRIBUTION OF DOCUMENTS:
Copy of the signed order to Teresa Rozic.
REVIEWED
LEGAL COUNSEL
For Recording Stamp Only
BEFORE THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTES COUNTY, OREGON
An Order Declaring All Sums Immediately
Due and Payable Owed by Morgan Reed
Pursuant to Promissory Note, Document No.
2007 -154, and Trust Deed.
*
* ORDER NO. 2009 -055
WHEREAS, on March 15, 2007, the Deschutes County Sheriff held an auction to sell County-
owned property, including the property legally described as:
Block #27, Lot #34, of OREGON WATER WONDERLAND, Unit 2, as shown by map
on file in the office of the County Clerk, subject to building and use restrictions recorded
in Book 166, Page 723, Deed Records, Deschutes County, Oregon, subject to covenants,
conditions, reservations, easements, and rights -of -way of record, together with 1 /1045th
undivided interest as tenants in common in the following described parcels: Parcels E, F,
G, H, and I,
and commonly known as 17270 Brant Dr, Bend, Oregon 97707; and
WHEREAS, at the auction, Morgan Reed had the winning bid for the above property of
$73,600.00 and paid a down payment of $18,400.00; and
WHEREAS, on April 20, 2007, Morgan Reed executed a promissory note, Document 2007 - 154,
to the County for the remainder of the purchase price; and
WHEREAS on April 23, 2007, a trust deed securing the promissory note was recorded in the
Deschutes County Official Records at Book and Page 2007 - 229459; and
WHEREAS, Morgan Reed is in default on the promissory note and trust deed (together
"Contract ") by failure to make the require monthly payments beginning November 2008 and continuing t J
the current date; and
WHEREAS, Morgan Reed is in default by also failing to pay the 2008 -2009 real property taxes
for the above described property; and
WHEREAS, in order to foreclose on the Contract, the Contract requires the County to declare a' l
sums under and secured by the Contract immediately due and payable and to elect to proceed t
foreclosure by advertisement and sale; and
WHEREAS, the above described property is subject to judgment lien in the name of Ray Klein ,
Inc. for an approximate amount of $2,400.00 and such lien is prior in time to the Contract; now, therefore
PAGE 1 OF 2- ORDER No. 2009 -055 (07/22/09)
THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTES COUNTY, OREGON,
ORDERS as follows:
Section 1. The Board of County Commissioners ( "Board ") declares Morgan Reed to have
defaulted on his obligations under the Contract and declares all sums under and secured by the Contract
due and payable.
Section 2. The Board elects to foreclose the Contract by advertisement and sale.
Section 3. The Property and Facilities and Legal departments shall take all necessary actions 10
foreclose the Contract and are authorize to bid at the foreclosure sale whatever dollar amount will satisfy
the County's lien interest in this property, including the interest and late fees owed by Morgan Reed.
Section 4. After the close of the trustee's sale and upon Deschutes County being declared the
winning bidder, the Property and Facilities Department is authorized to pay the dollar amount necessary to
remove the judgment lien from the subject property.
Dated this of , 2009 BOARD OF COLTNTY COMMISSIONERS
OF DESCHUTES COUNTY, OREGON
TAMMY BANEY, Chair
DENNIS R. LUKE, Vice Chair
ATTEST:
Recording Secretary ALAN UNGER, Commissioner
PAGE 2 OF 2- ORDER No. 2009 -055 (07/22/09)