Re: HOA lien and equity

I don't think anyone addressed the question with the overage paid at auction (assuming there are no junior liens in line to collect). Can the overage paid at auction ultimately get refunded to the party that bought it at trustee sale?

I recently did an HOA flip. It was a bear. When I found a buyer, it was EXTREMELY difficult to find a title insurance company to insure the new transaction. The title officer fine-tooth-combed the entire trustee sale. He found a small defect and made me get a quit claim from previous owner (the guy was nice enough to quit claim for $1,200). All this was to make the title insurance company warm and fuzzy.

The title officer told me they won't insure an HOA deal that has a huge profit margin because it means the previous owner got screwed out of equity and will sue at some point in time.

Between the time for redemption period, standard eviction, burning through 2 escrows while trying to get title to insure, all during a declining market, my potential profit slipped from $60k to an actual $23k. While my inital investment was only $10k, I don't know if I would put myself through this that pain again.