when a bank has an auction on a forclosed home...where does that auction take place?

Question

can you get a loan to buy the forclosed home or do you need a cashiers check?

Answer 1

The rules vary from State to State, so in order to answer your question we'd have to know what state you are in. However, most states provide that the Trustee's Sale or "auction" be held within the county where the real property is located. Generally these auctions are scheduled by the Trustee under the deed of trust, and generally they are held in the "County Seat". i.e. the place in the county where the County Government has its offices, courts and the like. Often they are held on the Courthouse steps - sometimes they are held in other locations. The date time and location of the sale are almost always set forth on the Notice of Trustee's Sale which has been recorded against the property.

In most cases, you will need to have a cashiers check (or checks) in the amount of your bid in order to purchase the property.

Now that you know WHERE the sale is going to be held, and how to pay for it, you need to know WHAT you are bidding on. . . . and don't expect to show up the day of the sale and have someone explain it to you.

You need to do your homework long in advance of the actual Trustee's Sale. You should ALWAYS obtain and review a preliminary title report, or have your attorney review the title of ANY property that you are considering entering a bid on.You want to make sure that you are bidding on a FIRST deed of trust instead of a second or third deed of trust. If you bid on a second deed of trust and win the bidding war, you will have just purchased the property "subject to" the first deed of trust. That means you will be responsible for making the payments for the first deed of trust. If that deed of trust is in default and is in foreclosure, you will have to cure that default. Even if you cure the default on the first deed of trust, if it has a "due on sale" clause, you will be expected to immediately pay the full balance of the first deed of trust. If you don't, the holder of the first deed of trust will commence a new foreclosure on your interest and take the property from you.

Bear in mind that you will not be allowed to inspect the property before bidding. If you buy a termite riddled shack with Radon seeping through the floors it becomes your responsibility to fix it up. If you buy a toxic dump it becomes your responsibility to clean it up. If the old owners are still in the property it will become your obligation to evict them, and they usually have no obligation to pay you rent while you do so.

Long and short - bidding at a foreclosure sale is risky business and best left to those who are experts with a lot of cash. If you are truly interested in buying a foreclosure it is best to let the lender complete their foreclosure, evict the tenants and clean up the property. Contact the lenders "REO Department" and ask to look at some of their properties. Its far safer that way and you stand less of a chance of getting burned.

Answer 2

Non-judicial foreclosures usually take place at the county courthouse... One tact is to talk to the homeowner (before the auction) and see if you can make arrangements to buy, cooperate with the lender to re-assign loan over to you. This is usually done by giving the homeowner an offer for cash to (walk away) Quit Claim the property to you, pay the arrears and then assume the loan, (most loans now however are non-assumable, yet in this market climate you may find willing lenders).

If not, yes... you're pretty much talking about a cashiers check at the sale. Advice from most of my clients is, "don't bid at auction... people get the fever and pay too much!" Try to make a deal happen before the auction.

If you can work with a lender, get pre-qualified, and let them know you are trying to buy a foreclosure, many will work with you... It's hard to tell right now... the industry is really stressed with all the sub-prime fiasco stuff going on... One thing important... most homes (95%) do not actually go to sale... some kind of arrangements are usually made to stay off the auction.

Answer 3

They can have it at the courthouse and depending what state, county the property is in, it could even be at the home.... I would call the superior court and ask the questions there. They will provide you with the information you need, to a point. Some may ask that you place some cash down to get a list of homes in advance and show you have real interest in purchasing auctions. The list is a great help; you can drive by the property to get a look, at least from the outside or thru the windows. NEVER bid on property you have no clue of, you could loose.

Answer 4

The auctions usually take place at the courthouse or City Hall (call and ask) and in a lot of cases, you merely walk up to the clerk's desk and ask about it. A cashier's check is good--you would need at least 12% of the final cost as an earnest pay. Then you can go and get the loan. (In some places they won't give a loan until you have a final amount so it depends on your bank or loan company.)

Answer 5

You almost always have to have a cashier's check to pay right at the end of the auction. Some auctions are set up so the person would have 3-7 days to make final payment. But getting financing is normally not an option.

Answer 6

Home loans are now available to many people for whom they would have been out of the question just a few years ago. You’d be in much better shape to bargain for better interest rates if you had a more impressive credit history, but if the house you want is the deal youinterest rates, get bigger returns on the money loaned, and the borrowers get a homes in which to build equity, and chances to restore their credit records so that the first bad credit home loans they take will also be the last!

Answer 7

Yes, you need to file bankruptcy to avoid the bank for going after you for the remaining of the loan amount that the bank cannot recovered by selling your house. If you don't file bankruptcy, the bank can take you to court and they may in turn take whatever assets you have to cover their loss.