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Foreclosure Forum |
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Re: I hope you're as curious as I am.In Reply to: Made a mistake? how much was this worth? posted by Nick(CO) on November 04, 2001 at 11:07 AM : Readers: : I recently passed on a (Colorado) foreclosure because I did not : 1. The lien in question was granted by previous owners. : 2. Currently home is incumbered by large mortgage. Sale price on : 3. Of course the name on the property and the name on the lien : 4. I assume the title company for the new owner made a mistake : The question is: What is the maximum amount that the foreclosed =•=•=•=•=•=•=•=•=•=•=•= Nick, to put this in terms that I can understand, you have a house that went to foreclosure sale, given the following criteria: Fair Market Value (FMV) of the property = $175,000 And I think what you’re asking is, what’s the maximum one should bid for the property at the trustee’s sale of the 1st trust deed? First of all, the foreclosure of a 1st will extinguish itself and wipe off the title of the property any liens and interests junior to it. That means the 2nd, regardless its makeup, would be gone and also the owner’s interest in the property. Did you actually look at the 2nd trust deed, either at the county recorder’s office or get a free copy faxed to you by the customer service department of a local title company? If you didn’t then you might want to, just for the educational value. I’d almost bet it’s an all-inclusive trust deed (AITD), also known as a wrap-around trust deed. That’s one that includes in its balance the balance of any senior included lien. If it’s not an AITD then there are several more possible explanations, but that’s the most common explanation of a junior lien with a much larger balance than a senior lien. But all that’s moot when a senior lien is going to sale, since it wipes out all the junior stuff anyway. If I were you Nick, I’d check to see what the final bid at the trustee’s sale of the first was. If you’re in a weak (buyer’s) real estate market, and a pro was the winning bidder, then the max should have been somewhere around $113,500 to $122,500. That’s about 65% to 70% of the FMV of the property. That would have produced an overbid of $70,000 to $80,000 which would go downward to the beneficiary of the 2nd deed of trust. By the way, I don’t see where any title company made a mistake, but if I’m right, you may have missed a good deal—depends on where the bidding stopped. If you're curious call the trustee and find out. Follow Ups:
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