Buying from the owner before the foreclosure auction.

Subject:

Comments:
: : There is going to be an auction in my town soon and I am wondering if there is a way of purchasing one of the homes on the list before the auction is held. : =•=•=•=•=•=•=•=•=•=•= : Jason, : In CA you can often buy a home that is in foreclosure from the property owner—before the trustee’s sale is held. Of course, before you needlessly spend hours of time with owner, you’d want to check the property’s title at the county recorder’s office to see what liens there are against it. Then you’d need to call the tax collector’s office to determine the unpaid property taxes against it. : Finally you’d need to determine the property’s current fair market value (FMV). To determine the owner’s gross equity you’d subtract from the FMV the balance of all liens you discovered at the recorder’s office and the unpaid property taxes. : To determine the foreclosure owner’s net equity you’d go on to subtract all the existing encumbrances, all the back payments and penalties, cosmetic improvements required, repairs needed, re-sale expenses (commissions, transactional expenses, buyer’s points) and the recurring monthly PITI payments during your 4 to 5 month turnaround. : Make sure your contract paperwork with the owner complies with CA’s Civil Code Section 1695 and that you don’t take “unconscionable advantage” of the owner in foreclosure.

Optional Link URL:
Link Title:
Optional Image URL: