2023 CODE OF GEORGIA › Title 44 - PROPERTY (§§ 44-1-1 — 44-17-7) › Chapter 3 - REGULATION OF SPECIALIZED LAND TRANSACTIONS (§§ 44-3-1 — 44-3-250) › Article 5 - TIME-SHARE PROJECTS AND PROGRAMS (§§ 44-3-160 — 44-3-207) › Part 7 - MISCELLANEOUS (§§ 44-3-193 — 44-3-207) › Section 44-3-207 - Time share estates; trustee foreclosures; requirements

(a)
(1)
(A)
In order to sell a time-share estate for the purpose of paying any or all unpaid assessments and other charges owed by the owner of such time-share estate, an owners' association, or its managing agent on behalf of the owner's association, may foreclose its lien for all assessments and other charges assessed by the owners' association upon a time-share estate pursuant to the time-share instrument or subsections (a) and (b) of Code Section
44-3-109
, in accordance with:
(i)
The judicial foreclosure procedure of subsection (c) of Code Section
44-3-109
or
44-3-232
, as applicable;
(ii)
The trustee foreclosure procedure under this Code section; or
(iii)
The nonjudicial foreclosure procedure under Code Section
44-3-206
.
(B)
If the time-share instrument contains any provision specifically prohibiting the use of the trustee foreclosure procedure, or if the owners' association otherwise determines that the time-share instrument should be amended to specifically provide for the use of the trustee foreclosure procedure, an amendment to the time-share instrument permitting the use of the trustee foreclosure procedure set forth in this Code section must be adopted and recorded prior to the use of the trustee foreclosure procedure. Prior to the owners' association's first use of the trustee foreclosure procedure, it shall notify all owners of time-share estates in the time-share program that, after the date of the notification, the owners' association has the right to elect to use the trustee foreclosure procedure with respect to any foreclosure of assessment liens as established in this Code section. The owners' association, or its managing agent on behalf of the owners' association, shall be deemed to have complied with this notice requirement if the owners of time-share estates in the time-share program are informed by mail sent to each owner's property address that was most recently provided to the owners' association, in the notice of an annual or special meeting of the owners, by posting on the website of the applicable time-share program, or by any other communication used by the owners' association.
(2)
A mortgagee may foreclose its mortgage upon a time-share estate in accordance with Part 2 of Article 7 of Chapter 14 of this title or may foreclose its mortgage pursuant to the trustee foreclosure procedure under this Code section in order to sell a time-share estate for the purpose of satisfying any obligation of the owner of such time-share estate created by such mortgage; provided, however, that the mortgage, or an amendment to a mortgage executed by the owner of the time-share estate, permits the trustee foreclosure procedure.
(b)
(1)
For the purpose of carrying out and effectuating a trustee foreclosure authorized by this Code section, the owners' association or mortgagee, as applicable, shall appoint a trustee or substitute trustee by recording a notice of appointment of trustee or notice of substitution of trustee in the official records of the county in which the time-share estate is located. The owners' association or mortgagee may appoint multiple trustees in a single appointment, and any appointed trustee may be used by the owners' association, its managing agent, or the mortgagee, as applicable, regarding the trustee foreclosure of any assessment lien or mortgage under any time-share project for which the trustee is appointed. The recorded notice of appointment of trustee or notice of substitution of trustee shall contain the name and address of the trustee or substitute trustee, the name and address of the owners' association or mortgagee, and the name and address of the time-share project.
(2)
For purposes of this Code section, an attorney who is a member in good standing of the State Bar of Georgia and who has been practicing law for at least five years, or that attorney's law firm, or a title insurer, underwriter, or agent authorized to transact business in this state is permitted to serve as a trustee or substitute trustee. A trustee shall use good faith, skill, care, and diligence in discharging all of the trustee duties under this Code section and shall deal honestly and fairly with all parties. A trustee who intentionally violates the provisions of this Code section concerning the trustee foreclosure procedure shall be guilty of a felony and shall be punished by a fine of not more than $5,000.00 or imprisonment for not less than one year nor more than three years, or both.
(c)
(1)
Before initiating the trustee foreclosure procedure against any time-share estate, a claim of lien or mortgage against the time-share estate shall have been recorded in the county in which the time-share estate is located.
(2)
In any trustee foreclosure proceeding, the trustee shall first deliver to the owner of the time-share estate a written notice of default sent by registered or certified mail or statutory overnight delivery, return receipt requested, to the owner's property address that was most recently provided to the owners' association or mortgagee and no later than 30 days prior to the initiation of the trustee foreclosure procedure. The notice of default shall be deemed delivered on the official postmark day or the day on which it is received for delivery by a commercial delivery firm. The notice of default shall state:
(A)
The intent of the owners' association or mortgagee to commence foreclosing on the assessment lien or mortgage, after the end of the 30 day period, using the trustee foreclosure procedure set forth in this Code section;
(B)
The address and telephone number of the trustee and owners' association, its managing agent, or the mortgagee, as applicable;
(C)
The legal description of the time-share estate;
(D)
The nature of the default;
(E)
The outstanding amounts secured by the assessment lien or mortgage and a per diem amount to account for further accrual of such amounts;
(F)
The method by which the owner of the time-share estate may cure the default; and
(G)
The right of the owner of the time-share estate to object to the use of the trustee foreclosure procedure and require the owners' association or mortgagee to proceed thereafter only with a judicial foreclosure action as to that specified default by delivering a written objection to the trustee within 20 days after the delivery date of the notice.
(3)
At any time before the trustee foreclosure sale of the encumbered time-share estate is consummated pursuant to subsection (e) of this Code section, the owner of the time-share estate may cure the default and redeem the time-share estate by paying the amounts secured by the assessment lien or mortgage in cash or certified funds to the trustee. No right of redemption shall exist after the consummation of the sale.
(d)
(1)
In order for a trustee to sell an encumbered time-share estate foreclosed under this Code section:
(A)
The trustee must have provided the written notice of default as required under paragraph (2) of subsection (c) of this Code section, and a period of at least 30 calendar days must have elapsed after such notice of default is deemed delivered;
(B)
The trustee must not have received from the owner of the time-share estate a written objection to the use of the trustee foreclosure procedure prior to the end of the 20 day period provided for in the notice of default and the time-share estate was not redeemed under paragraph (3) of subsection (c) of this Code section;
(C)
The trustee must have delivered a notice of sale meeting the requirements of paragraph (4) of this subsection to the owner of the time-share estate, by registered or certified mail or statutory overnight delivery, return receipt requested, to the property address of the owner of the time-share estate most recently provided to the owners' association or mortgagee no later than 30 days prior to the date of the proposed sale and the notice of sale shall be deemed delivered on the official postmark day or the day on which it is received for delivery by a commercial delivery firm;
(D)
The trustee must have delivered a copy of the notice of sale to any junior lien holder of record by registered or certified mail or statutory overnight delivery, return receipt requested, no later than 30 days prior to the date of the proposed sale. The notice of sale shall be deemed delivered on the official postmark day or the day on which it is received for delivery by a commercial delivery firm;
(E)
The trustee must have recorded a copy of the notice of sale in the official records of the county in which the time-share estate is located not less than 30 days prior to the date of the proposed sale; and
(F)
The trustee must have published a notice in the legal organ for the county in which the time-share estate is located, or if there is no newspaper designated as such, then in the nearest newspaper having the largest general circulation in such county, once a week during the four calendar weeks immediately preceding the calendar week of the date of such sale. The last of such notices shall be published at least seven calendar days prior to the date of the sale.
(2)
If a notice of lis pendens has not previously been recorded, the recording of the notice of sale shall have the same force and effect as the filing of a lis pendens in a judicial proceeding.
(3)
Any trustee foreclosure sale pursuant to this subsection shall be conducted by the trustee, or by an agent of the trustee under the supervision of the trustee, and shall occur on a legal sale day within the legal hours of sale at the place of sale designated in the notice of sale, which must be accessible to the public in the county where the time-share estate is located. The trustee foreclosure sale may also occur online at a specific website on the internet or in any other manner used for a judicial foreclosure sale procedure in the county in which the time-share estate is located.
(4)
The notice of sale required by paragraph (1) of this subsection shall be in writing and shall state:
(A)
The name of the owner of the time-share estate;
(B)
The legal description of the time-share estate;
(C)
The name and address of the trustee;
(D)
A description of the default that is the basis for the foreclosure;
(E)
The recording information for the assessment lien or mortgage;
(F)
The amounts secured by the assessment lien or mortgage and a per diem amount to account for further accrual of the amounts secured by the assessment lien or mortgage; and
(G)
The date, location, and starting time of the trustee foreclosure sale, which shall be between the hours of 9:00 A.M. and 4:00 P.M., eastern standard time.
(e)
(1)
At the trustee foreclosure sale, the trustee shall issue to the highest bidder, who has paid the price bid in cash or certified funds, as purchaser or purchasers, a certificate of sale stating that a foreclosure conforming to the requirements of this Code section has occurred, including the time, location, and date of the sale; a legal description of the time-share estate that was sold; the amounts secured by the assessment lien or mortgage; the amount of the highest bid; and the name of the purchaser. Within three days of the trustee foreclosure sale, a copy of the certificate of sale shall be sent by registered or certified mail or statutory overnight delivery, return receipt requested, to the owner of the time-share estate at the owner's property address that was most recently provided to the owners' association or mortgagee. Upon the issuance of a certificate of sale, all of the rights of redemption of the owner of the time-share estate that have been foreclosed under this Code section shall terminate.
(2)
Within ten calendar days after a sale, absent the prior filing and service on the trustee of a judicial action to enjoin issuance of the trustee foreclosure deed to the time-share estate, the trustee shall issue a trustee foreclosure deed to the purchaser and deliver the trustee foreclosure deed to the clerk of the superior court for recording in the official records of the county in which the time-share estate is located. The trustee foreclosure deed shall include the name and address of the trustee, the name and address of the purchaser or purchasers, the name and address of the former owner of the time-share estate, and a legal description of the time-share estate. The trustee foreclosure deed shall contain no warranties of title from the trustee. A certificate of compliance confirming that the notice and publication requirements of this Code section were met, that the default was not cured, that the trustee did not timely receive any written objection to the trustee foreclosure procedure from the owner of the time-share estate, and that the time-share estate was not timely redeemed shall be executed by the trustee and attached as an exhibit to the trustee foreclosure deed.
(3)
A sale and delivery of the trustee foreclosure undertaken as authorized by this Code section shall divest the owner of the time-share estate of all right, title, interest, and equity that such owner has in or to the time-share estate and shall vest fee simple title to the time-share estate in the purchaser or purchasers at the trustee foreclosure sale. The issuance and recording of the trustee foreclosure deed is presumed valid and may be relied upon by third parties without actual knowledge of irregularities in the trustee foreclosure proceedings.
(4)
The proceeds of the trustee foreclosure sale shall be applied first in accordance with the lien priorities set forth in paragraphs (1) through (4) of subsection (a) of Code Section
44-3-109
, after which any remaining proceeds shall be applied to the payment in full of such unpaid assessments and other charges or mortgage obligations, as applicable, and next to the payment of all expenses actually incurred by the owners' association in connection with the trustee foreclosure proceedings, including attorneys' fees. Any remaining proceeds shall be paid to the prior owner of the time-share estate. The owners' association or mortgagee, as applicable, may bid at the sale and purchase the time-share estate and receive a credit up to the amount of unpaid assessments and other charges or mortgage obligations, as applicable, and all expenses actually incurred by the owners' association or mortgagee, as applicable, in connection with the trustee foreclosure proceedings, including attorney's fees.
(5)
A trustee foreclosure sale releases the prior owner of the time-share estate of liability for any and all amounts secured by the assessment lien or mortgage, as applicable. The owners' association or mortgagee, as applicable, has no right to any deficiency judgment against the prior owner of the time-share estate after the completion of the trustee foreclosure sale of the time-share estate under this Code section.
Added by 2023 Ga. Laws 337,§ 3, eff. 7/1/2023.