I have attend several sherif sale auction at the Hamilton county court house in Cincinnati Ohio. I am very interested in beginning to purchase Fix and flip homes here. My only issue is there is very little info on how the whole thing works, and everyone down there that bids successfully I have asked to discuss it with me does not want to share information with me.
Any insight on sherif sales would be much appreciated:
I understand the risk of having to buy them with out seeing the inside, possibly evicting the tenant, having an unclean title. My question what do you check for these things? Do you really have a title company run a title search on the property of interest only to then have it withdrawn from sale last minute? Do you check the recorders office to see what the bank is owed? How do other BPs buy at sherifs auctions?
Hey Jered, I realize this is an old post now but have you learned anything else since you posted? I have had the same experience not finding the information I'd like to bid confidently.
I am particularly interested in the tax sales they do every other Thursday. If you stick around until after the mortgage foreclosures are over then over half the crowd leaves and hardly anyone bids on delinquent tax sales. From what I can tell, you actually take title if you win the bid. Other states let you buy the lien but in these cases I think you actually buy the property. Seems to good to be true. Any thoughts?
This sounds very interesting, I'm brand new to all of this as well so I can't offer advise. I hope someone comes along to assist soon. I'd love to hear some tips on this.
@Anderson Morgan I have learned a few things.
1. Hamilton County is a tax deed county. Meaning when you win the auction, you own the property. You have to pay within 24 hours though cashiers check.
2. Foreclosures are a tough animal, 99% of properties get bought back by the bank at auction.
3. Tax sale has decent inventory of rental properties in class C, D and F areas. They are switching though to a online system so bids will be placed online. No one knows yet what this will look like.
4. Since this is government, they will take 2-3 months to record the deed in your name.
4. Most properties you buy will have all kinds of title issues. For example, I just bought a two family that has a federal tax lien. Meaning the federal government has 120 days to buy the property back from me for the price I paid at auction. So basically I am going to wait 2 months for the deed to be put in my name plus another 4 months before I can even start improving the property. I don't like having my cash is sitting in a property that isn't producing cashflow, but when the price is right it's worth the wait.
@Jacob Murphy Thanks for the great information!! Did the IRS buy back your property? Im guessing no..
About the foreclosures, why does the bank by the property back? They will then sell it on the MLS or on some online auction website for more money? I thought they owned the property already so Im confused as why they are buying it back?
@Joe Ebanks No I never received any mailings or calls from the IRS. From talking to my closing attorney, he has never seen the IRS claim a property in the 30 years he has been doing this. Its a pretty safe bet that they won't exercise their right.
As far as why banks buy back properties, I honestly don't know for sure. I've wondered many times myself. I have heard that the banks have insurance policies in case of foreclosure but the only way they can settle their claim is to win the auction at the foreclosure sale. So basically they are willing to pay up to the settlement amount at the auction, which almost always is higher than what an investor can pay and still make money. Not sure if this is true or not.
Maybe @Brandon Turner knows something more since he has banking experience...
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