Homeowner Association Lien - Foreclosure
Hi,
I'm very new .. hopefully this will be my first property. There is a townhome in my area (south florida) that has a final judgement and court house sale date set for later this month. The lien amount is for about $5,000 for attorney fees and unpaid homeowner association fees.
I contacted the courthouse and they said that if I'm the winning bidder, then I have to pay the amount in full by 2:00 pm - sale is at 11:00. The final judgement also serves as the eviction notice to the current homeowner, that they have 11 days to vacate the property after the foreclosure sale.
Here are the property details.
There is a mortgage on the property for $127,000 which from searching the courthouse records must be current as there is no docs filed ref foreclosure.
Comps for the same property in the area come in at about $170,000 (this is a townhouse community).
I don't know how to get a hard money loan since I can't get in to see the property, so the most I can bid is about $25,000 - but the judgement amount is only $5000, so I hope I can get it closer to the judgement amount.
So if I have the winning bid and pay the court by 2:00 pm, then I get title to the property after 10 days and by the 11th day after the sale, the current homeowner is evicted/moved out. What happens to the mortgage on the property? Does the mortgage company lose the property to me as the new owner? There are no other liens on the proprerty from what I saw searching court records. I didn't do a title search/abstraction.
I just really don't know how to go about this. I'm a member of the local real estate investment group, but I just joined so I don't know who to contact for help, if they will even help me.
Any replies and help on how to do this would be greatly appreciated!
Thank you!
Chrisk101 - My recommendation...get the title work done and find some hard $$. South FL is swimming with investors who will probably be all over that foreclosure. The good thing is, in So FL, hard $$ is all over the place - I've even seen it to 80% LTV at single digit interest rates.
Chrisk101,
I too am new in REI, and I have recently been doing reading about this. My understanding is that you would acquire the property subject to all senior mortgages and liens. I understand this to mean that you just need to keep up the current mortgage payments. Since, however, there would be a transfer of ownership, I would think a due on sale clause may kick in, so if you didn't get other financing, you may need to sell it quickly.
One newbie to another.
Sounds fishy to me, why would the homeowners not pay that lien, Any homeowner woud be insane not to reach some agreement with the lien holder, to lose a 170k home over a 5k lien? There is to much equity there, it just does not make sense!!