Q: I am planning to make an offer on a house listed for sale that had a court ruled foreclosure several weeks ago.
the history of the property has foreclosure final date of early march with auction scheduled for late june. The court docs state a bank lien is placed on the property. Is this house technically in foreclosure or preforeclosure? This is not listed as a "special sale" on MLS. Are the risks of purchasing in this scenario similar to buying REO foreclosed property (expect the property to be stripped of all valuables including appliances etc.)
A: You’d obviously be buying it subject to foreclosure. If auction is scheduled then there’s already a judgment in the bank’s favor. You can have a lawyer review the documents to advise you what the required purchase price would have to be to acquire ownership, and it would have to be done with the bank. I would not contact the listing agent about this.
A:
No one should buy or sell real estate without a lawyer. There are so many things that could go wrong, especially with a HOA involved, it would take an explanation that is too long for this forum.
The bank has a judgment of foreclosure and the amount of the judgment is what matters. There could also still be debt to the HOA since the HOA debt is not wiped out by a bank foreclosure unless the HOA Declaration of Covenants and Conditions specifically provide for the debt to be erased. There could be other liens against the property that might not be wiped out by a bank foreclosure.
The owner still holds title to the property until the auction but the judgment has to be satisfied along with any amounts due to the HOA or other priority liens.
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