Buying at Foreclosure Auction

So here is my situation. I’m renting a home which is up for foreclosure on Court house in 2 weeks time. A couple of months back as renter I put in a short sale offer to the Bank, but I haven’t heard anything (neither accept nor reject) back from the bank. I think it may be a win-win situation if it goes through short sale for every party involved. But I cannot answer why the bank isn’t responding.

I would now like to make bid at the foreclosure auction. I contacted the attorneys of the bank and they told me that they would give 30 days to close in if I was the highest bidder. Since I’m renting this property and living in it I know what condition the property is in. Here are my questions -

  1. Is there anyway I can contact the bank to push out the foreclosure date? My real estate agent has tried to contact the bank’s listing agent but in vain.

  2. I’m planning to get a Title search done from an real estate attorney. Is this sufficient or should I have to do anything else before going into foreclosure auction? Does the title search indicate unpaid taxes, unpaid land transfer taxes, special assessments, easements, rights of way etc? If not how can I get these information?

  3. Should I be concerned that I get just 30 days to close in? My mortgage vendor is confident of getting loan in 30 days? Should I have full cash ready as back up?

  4. As backup option my brother has offered me that he would buy this home in cash and then sell it to me. This is in case getting a loan timely manner fails. The plan is later on I buy back from him cutting out a mortgage loan. Is this option feasible? What are the consequences?


Foreclosure Sale

  1. If the bank is willing to wait 30 days for you to settle after the foreclosure sale, you are extremely lucky. Here the foreclosure sales are conducted by the Sheriff and most of them require 10% the day of the sale and the balance 90% in as short as end of that day or as long as end of that week, usually 2 to 4 days. Since the funds go to the Sheriff and you have to pay the balance within days, at least here I’m not sure how that would possibly work. But every state is different.

  2. A title search by an attorney or a title company will show all liens, judgements, mortgages and taxes owed. Generally the title search goes back 60 years sometimes longer. A family member of mine ended up owing a delinquent tax bill that was almost 100 years old plus interest to date. Fortunately the 100 year old tax bill was a very small amount.

  3. The banks are always posponing the sales for seemingly no reasons. There is a house vacant for 2 years near one of my places. for some unknown reason the bank has posponed the sale AGAIN. It obviously not to keep the people in the house, they are long gone rumorred to be out of state.
    I can see a postponement if the bank and the owner are trying to work out a deal to prevent the foreclosure, like sale of the house or refi, or modification, but when none of those are happening, postponement seems like beating a dead horse.

  4. Typically the department at the bank handling the short sale, is not the same department that is handling the foreclosure, and it often appears that they never talk to each other. A friend of mine put an offer in on a listed short sale house. It was listed for $120,000 and needed extensive work, probably all new drywall inside plus some basement structrue work, plus there was some mold. My friend offered $110,000 CASH, nine months later the bank still had not replied to the written offer submitted to their listing agent.

  1. I doubt the bank will postpone the auction for you.

  2. Have the attorney give you an actual title commitment. In other words, will he insure the title if you win the bid?

  3. 30 days to close should not be an issue; 14 days is enough if you have given the lender all of your docs up front. If you use a big lender like Wells Fargo or Bank of America, you can be pretty sure that not only will they take longer than 30 days, but they will tell you otherwise and add a lot of stress to your deal. You would be better served by using a LOCAL lender.

  4. Having your brother pay cash is a great back up plan. Just be aware that you may not be able to get financing within 90 days after that purchase, so find out how long your brother is willing to lend the money.

Hope this helps.


Get title pol from T co

Likely no atty is needed as T Co’s title ins. policy will show all liens and the T co issuing it guarantees its policy.

So call and order T report from T co.