Bulletin: OR000016

Dear Associates:

A trustee's sale generally eliminates all interests recorded subsequent to the deed of trust/trust deed being foreclosed.

One exception, however, is a financing statement evidencing purchase money security interests in fixtures. In Alaska, Oregon and Washington a purchase money security interest in fixtures has priority over a previously recorded deed of trust/trust deed. As 45.09.310. ORS 79.3130. RCW 62A.9-313.

What does this mean? It means that financing statements disclosing loans made to purchase storm windows, appliances, furnaces, water heaters and other building improvements are not eliminated by foreclosure of a deed of trust/trust deed. This is true even though the deed of trust/trust deed was recorded before the financing statement.

When insuring titles derived from a trustee's sale do not eliminate financing statements that disclose a purchase money security interest even though the deed of trust/trust deed was recorded prior to the financing statement.

It may be difficult at times to distinguish between a purchase money security interest and a non-purchase money security interest. If you are uncertain, please contact me.