In my state, foreclosures are advertised in the “Legal Notices” section of the local newspaper, and they include the amount owed on the property.
I was caught off guard last week at the courthouse steps when the auctioneer named a property, and I did not have a copy of the legal notice for it. I usually have all the “cheapos,” so I thought I was slipping when she said the bank bid $37,600.
Having no information on the property, I did not bid. Neither did anyone else, so the bank bought it.
When I came home, I started digging through my legal notices looking for the property and found it. The original amount was listed at $110,000. That explains why I had ignored it. I called the auctioneer who said it was too late to bid on it; that I should contact the foreclosure attorney.
I was puzzled with the low bid of $37,600. I thought it might be a second mortgage, and the buyer would have to pay the first mortgage also.
I called my attorney who called the foreclosing attorney and learned that $110,000 was advertised as the total owed on the property, but there was a “piggyback” loan on it held by the same bank.
The bank could legally only foreclose on the original. The “piggyback” became a second mortgage and got wiped out at foreclosure. I could have it if I would pay $37,700!
I wired the money and faxed the Memorandum of Trustee’s Sale they emailed to me. I got the deed in the mail Wednesday and signed a sales contract with an investor on Thursday. I sold it for $54,000. We close at the end of the month. The investor got a good deal, as this is a level lot 130′ x 309′ with two “fixer-uppers” on it.
I am happy; I am lucky; and I learned something…In the future, I will not assume anything when I read the Legal Notices.
[This is Mary’s second Success Story. Read her first one here: My Neighbors Just Gave Me Their House!