Posted by DougW on October 31, 2001 at 13:56:51:
Thanks… a good example of why study is important.
Doug
Court House Auction / Unserved Lien - Posted by m.a.
Posted by m.a. on October 29, 2001 at 19:18:57:
We purchased, rehabbed and have a sales contract on a house we bought at the courthouse foreclosure auction. There is one problem.
There was an unserviceable (financed) water treatment system in the house and the company had not been served in the foreclosure. The couple who lost the house gave us the finance papers and basically had been making those particular payments throughout the process. Their current statement said balance due was @ $1300.00.
We now have a sales contract on the house and called the finance company to see if they would go 50% or something like that. However they said their figures were more like $4300.00 and would take $2000.00. We called the water treatment company and asked if they could just come and take away the system and release the lien, and they said its basically up to the finance company.
I know we are not in the best position in this situation, but does anyone have an idea for us. We could actually close in two days if it weren’t for this lien.
Also can I demand to know how the finance company came up with their figures if the original owner thought they only owed about $1300.00. And could I just haul the system over to the company and give it to them…any help is definately appreciated…thanks
Re: Court House Auction / Unserved Lien - Posted by David Krulac
Posted by David Krulac on October 30, 2001 at 13:29:26:
went to a sale once where a buyer missed an $186,000 mortgage that was not served. The buyers were delighted to make such an “excellent” purchase and wondered why nobody bid against them.
Not too many options, but… - Posted by JT - IN
Posted by JT - IN on October 29, 2001 at 19:58:50:
MA:
Do not haul the system over to the company, this may make matters worse. Besides, it may be more useful in hand, toward negotiating a better settlement.
First, check the date of the lien, and be sure that the date the lien was filed, is prior to the date of the foreclosure suit being filed. If by some chance the softner lien is post foreclosure lien, that would be an out for you.
Absent that, the best thing that you have to work with are the finance papers that the owner gave you,. With those in hand, you should be able to figure out exactly what the balance is on the acct, (original balance+interest rate+ amortization, less pymts), and use that info for a negotiated payoff. If possible, get the foreclosed owner to sign a POA, allowing you to discuss the account with the finance company, and then you will be able to discuss the account, and they will have to discuss the same with you.
You could try to excrow funds with the title company, and sign an agreement with the buyer, stipulating that you will satisfy the lien within x number of days. This way you could close and buy some time to negotiate with the finance company, all at the same time. Depending upon the lender, they may or may not go along with this escrow agreement.
Apparently, you did not do a title search before buying the property at Auction… Did the lien appear at that time, and was just missed by the Plaintiff’s Atty?
Good luck on geting this thing wrapped up, in the least expensive manner. The only good news is, the outstanding (negotiated) balance is $ 2000, not $ 20,000.
Just the way that I view things…
JT - IN
And people wonder… - Posted by JT - IN
Posted by JT - IN on October 30, 2001 at 14:36:03:
Why we caution newbies about jumping into a Sheriff Sale, to try to make a killing of a foreclosure deal.
“The Fat you smell burning in the fire, may just be your own.”
David, thanks for the real life story, as these tend to illustrate to an unsuspecting investor, why some of this IS important.
JT - IN