Help! Confused About Foreclosure With IRS Liens
We are considering bidding on a second mortgage at a foreclosure sale. There is an existing first mortgage (by the same lenders) and an IRS lien. Assuming I will be the successful bidder on the second...Will i have to pay off the first mortgage and the IRS lien to obtain a deed of trust?...or will the IRS liens follow the borrowers (mortgagees)? If I have to pay off the IRS this property cost would exceed its market value and would make a difference to me.
Just remember that when you buy at the trustee sales, you take it subject to any superior lines, such as the first and IRS liens in this case. After a trustee sale, the IRS has a 120 day right of redemption. If they choose to redeem, they must pay you the exact amount that you paid for the property at the sale, plus 9% (or so) interest on your money. After 120 days have passed, the IRS interest in the property goes away. Is the first in default? If so, and the sale is scheduled before the 120 days, it could get ugly for you.
I get the feeling you may be getting confused about the difference between a trust deed and a trustees deed. They are not the same thing. A trustees deed conveys title (ownership) after a trustee sale (public foreclosure auction). A trust deed secures a promissory note against a piece of real property.
In this case, if you buy this at auction, you will have both. A trustees deed conveying title to you, and a trust deed (the first) in the original owners name, securing the lenders interest.
Heres a link for Washington foreclosure law:
http://search.leg.wa.gov/pub/textsearch/ViewRoot.asp?Item=0&Action=Html
Good luck!
Great information! Appreciate the help!
We are moving forward!
I have not used that service, but have use a local only service called the Blue Sheet.
Several title companies publish lists as well for free.
and then there are for fee services from First American (Realquest)
IMHO you have worked as an appraiser. Have you talked to loss mitigators? The ones I have deal with seem like basic phone agents.
Banks / mortgagors are likely to be hiring mitigator do to the conditions. Maybe try a couple phone interviews and see how it goes. Or look to see what skill set they are looking for.
I have posted a similar question. I do not know how to accurately refer to the two career paths, but it seems that the people that answered your question are thinking of the loss mitigation people who work for the lender and negotiate short sells. I belief you are referring to working for a company that sends people out to the home to help delinquent homeowners decide what is their best options. These people are also called loss mitigation specialist but they are not employees of the lender. I do believe you have to be a realtor. Anybody have any idea what to call these people?
I appreciate the kind words. Infact that was my next step.
thanks.
jay
Financial health coach is great. They are expensive, but well worth it. If you have the desire to go all the way, they are for you.....for someone who is just testing the water, its probably not a good fit.
You are mixing things up a bit, which is perfectly normal.
I am going to make some assumptions. The house is in pre-foreclosure and the home owner still has title. (an REO is when the bank has already foreclosed and the bank now has titley). So the homeowner hired the realtor/broker and the homeowner is responsible for signing the Purchase and Sales contract (or his Power of Attorney. The only difference from this sale to other "normal" sales is that the homeowner is asking his lender to take a reduced payoff (a Short Sell). The lender sets the payoff amount and is not obligated to agree to any reduced amount.
It sounds like what went wrong is that the realtor did not have you, the buyer, sign a disclosure to say that the "sell is subject to bank approval". If there was this disclosure then you have no basis to be upset. If there was not this disclosure then you could try suing a person that does not have enough money to make their mortgage payments - but what would it get you?