Legal Question in Real Estate Law in Arizona

No, the quit claim deed does not make her loan an unsecured loan. The quit claim deed transferred to you whatever interest, if any, your mom had in the property. Under the scenario you laid out, your mother's interest in the property was subject to a mortgage. Mom cannot pass on to you more than she owned. Although you cannot be held personally liable for the repayment of the mortgage note, if you were never on the note, the mere act of Mom quit claiming the property to you does not mean the bank has lost its security interest in the property. You might want to look further into the lack of notice issue you raised regarding the foreclosure, but keep in mind that based on what you have written here, the property is still subject to a mortgage which will need to be paid even if the foreclosure has not been properly noticed.

The answer above is quite correct. If you want to keep the house, you will have to bring the loan current (cure the back payments due, plus penalties, and then only if the lender will allow you to do so) or you will have to get a new loan, in your own name, and pay off the old loan. You should take action immediately if you want to avoid the foreclosure.