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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Post auction offer on a VA sale. Posted by Ward-CA- on March 30, 2002 at 1:23 PM In Reply to: VA & after sale offer posted by Cindy MO on March 27, 2002 at 10:40 AM : Ward - Thank you for being so helpful; however, I am in need of your wisdom again. I have been asking questions pertaining to trustee sales in Missouri and need some more information. : My husband and I have been following a home listing. We would like to purchase it for ourselves as a primary residence. While we have about $10K saved, we do not have the 100% required at time of purchase. We have gone through a bank who has approved a loan amount that should be sufficient, but have recently gotten nervous because there is no guarantee of a clear title. I have researched the house at County Records and am sure the title is clear of senior loans but it does have a $25K junior loan. The bank is worried about the title clearing with a junior loan. They do not seem comfortable with the fact that the junior loan will be gone after the sale. They said they would do it if I got a commitment for title from the local title company for $400. This seems fine, however, I did not want to go to that extra expense if the bid price is going to be too high. The house was supposed to go up for sale earlier this week, but has been postponed once again. We called clear up until the time of sale and the trustee still did not know the bid price. They said they were waiting on the lender who was waiting for info. from the VA. Anyway---I finally get to my questions: : 1. I read in one of your responses to a previous question that there are three times to buy a home around a trustee sale. One of which was immediately after the sale with a written offer to the lender if they got the property back. You said to make the offer contingent upon an inspection and the issuance of a clear title. What else needs to be included in that letter? : 2. When they said they were waiting on info from the VA, does that mean if the lender gets it back it will automatically become a HUD house? If so, how do I go about tracking the home to them and making an offer? : 3. Are several delays common during these sale procedures? It seems apparent that the delays are not being caused by the owners as the house has been abandoned for some time. Also, the bank seems to think something "fishy" is going on because of the trustees inability to give a bid price on the home. They are getting worried that there may be some issue concerning the title, etc. : 4. Do you see anything that I am missing? The house is in need of repair and I personally think the current owners spent too much for it so the price advantage will not be that great. But it would be perfect for us after some elbow grease. I sure do welcome your ideas. Thank you again for your valuable time. =•=•=•=•=•=•=•=•=•=•= Cindy, First off, loans are either senior or junior to each other. So if there’s no other loan other than the $25K loan then it is the senior loan, right? Perhaps the bank is confused because you refer to the single loan as a junior lien when in reality it’s the senior lien. I don’t blame you not wanting to spend $400.00 when you don’t have to. But you have me puzzled. If you know that the loan being foreclosed upon is a VA loan then you know the bank has no incentive to sell you the property at a discount when they get it after the sale, since they can just transfer it to HUD and get paid in full. #1. Therefore no REO purchase is possible if the foreclosing loan was a VA loan. #2. In almost every metropolitan area there are real estate brokers who specialize in selling the repo’s that HUD gets in inventory. Find one of them and ask to be shown what’s on the market at the present time. #3. HUD sales can seem to take forever because they have to decide whether to fix up certain properties and not others, and what they will open up the minimum bid price for, etc. #4. Make an offer to HUD that's in line with the present market value of the property but discount it for the amount of repair and rehabbing that's required. I'd get a professional house inspector to give me a written inspection on all the stuff wrong with the house and use it as a justification for the amount of discount you want. Hope this helps Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : : Ward - Thank you for being so helpful; however, I am in need of your wisdom again. I have been asking questions pertaining to trustee sales in Missouri and need some more information. : : My husband and I have been following a home listing. We would like to purchase it for ourselves as a primary residence. While we have about $10K saved, we do not have the 100% required at time of purchase. We have gone through a bank who has approved a loan amount that should be sufficient, but have recently gotten nervous because there is no guarantee of a clear title. I have researched the house at County Records and am sure the title is clear of senior loans but it does have a $25K junior loan. The bank is worried about the title clearing with a junior loan. They do not seem comfortable with the fact that the junior loan will be gone after the sale. They said they would do it if I got a commitment for title from the local title company for $400. This seems fine, however, I did not want to go to that extra expense if the bid price is going to be too high. The house was supposed to go up for sale earlier this week, but has been postponed once again. We called clear up until the time of sale and the trustee still did not know the bid price. They said they were waiting on the lender who was waiting for info. from the VA. Anyway---I finally get to my questions: : : 1. I read in one of your responses to a previous question that there are three times to buy a home around a trustee sale. One of which was immediately after the sale with a written offer to the lender if they got the property back. You said to make the offer contingent upon an inspection and the issuance of a clear title. What else needs to be included in that letter? : : 2. When they said they were waiting on info from the VA, does that mean if the lender gets it back it will automatically become a HUD house? If so, how do I go about tracking the home to them and making an offer? : : 3. Are several delays common during these sale procedures? It seems apparent that the delays are not being caused by the owners as the house has been abandoned for some time. Also, the bank seems to think something "fishy" is going on because of the trustees inability to give a bid price on the home. They are getting worried that there may be some issue concerning the title, etc. : : 4. Do you see anything that I am missing? The house is in need of repair and I personally think the current owners spent too much for it so the price advantage will not be that great. But it would be perfect for us after some elbow grease. I sure do welcome your ideas. Thank you again for your valuable time. : =•=•=•=•=•=•=•=•=•=•= : Cindy, : First off, loans are either senior or junior to each other. So if there’s no other loan other than the $25K loan then it is the senior loan, right? Perhaps the bank is confused because you refer to the single loan as a junior lien when in reality it’s the senior lien. : I don’t blame you not wanting to spend $400.00 when you don’t have to. : But you have me puzzled. If you know that the loan being foreclosed upon is a VA loan then you know the bank has no incentive to sell you the property at a discount when they get it after the sale, since they can just transfer it to HUD and get paid in full. : #1. Therefore no REO purchase is possible if the foreclosing loan was a VA loan. : #2. In almost every metropolitan area there are real estate brokers who specialize in selling the repo’s that HUD gets in inventory. Find one of them and ask to be shown what’s on the market at the present time. : #3. HUD sales can seem to take forever because they have to decide whether to fix up certain properties and not others, and what they will open up the minimum bid price for, etc. : #4. Make an offer to HUD that's in line with the present market value of the property but discount it for the amount of repair and rehabbing that's required. I'd get a professional house inspector to give me a written inspection on all the stuff wrong with the house and use it as a justification for the amount of discount you want. : : Hope this helps Optional Link URL: Link Title: Optional Image URL: [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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