I bought a house at a foreclosure auction on May 27th. I decided not to contact the foreclosed upon owner (who lives in the house) about moving and redemption rights before the district court approved the sale.
The NM first district court has still not approved the sale. Yes, it's been 1 month and 2 days. $160K sitting in escrow at the district court. No action by the judge.
An investor called me last week to tell me he had approached the foreclosed upon owner and purchased the right of redemption. So I approached the foreclosed upon owner this week to confirm that she had sold her right of redemption... she confirmed.
But the investor has not filed the petition for redemption.
And of course the court has not approved the sale.
I am bummed about losing the deal. I am wondering if I still have any angle here, or do I just have to wait till the investor calls the right of redemption and let him have the house?
The second issue is that I have $160K sitting in escrow in District court waiting on a judge to do something... and I don't when that is going to be. And then, presumably, this investor has 30 days from the judge approving the order to redeem. I have a considerable amount of cash tied up for possibly more than 2 months. Is there anything I might do to accelerate the release of the funds?
And when does the 10% interest payment on these funds begin? That's actually a meaningful silver lining. Does it begin from the date of the auction, or the date the judge approved the sale.
You just need to wait until the judge makes a decision.
This buying of redemention rights is rampant here In Oregon.. those that buy the rights usually have no interest in the house.. they hold the rights hostage so you will pay them money for those rights.. I bet this person paid less than a grand for the rights. and will want 10k from you... State of Oregon is coming down on those folks that do this... As you need to be a licensed foreclosure consultant to buy pre foreclosure properties. Same in WA and CA. Not sure NM. If the court does not approve the sale the redemption rights are moot and the buyer of the rights wasted their time and money.
Highly unlikely that the investor who bought the rights wants the house... Other wise they would have bought it at the auction and would have told you they owned them so you would not waste your time and money bidding.. that's the other play these redemption buyers play.
Everyone want a piece of the pie.
thanks, it's very helpful to understand the ways this may play out.
the bottom line is that, at this point, i can't count on either owning the property outright or getting my funds back until 30 days AFTER the judge approves the sale. the investor may or may not seek to redeem the rights up to that point. i can't get them at this point.
and who knows when the judge will approve the sale.
now, of course, i regret not approaching the owner for the redemption rights prior to the sale being approved.
@? the little nuances one learns in the foreclosure bizz... states with redemption rights are very tricky... in Oregon the rights sunset after 6 months.. so many investors if they don't have the rights ( ie can't find the person who lost the house) Or does not want to pay someone who bought the redemption rights and is holding them hostage.. they just wait out the 6 months and go about their bizz... In Oregon you can kick out who ever is living there unless the federal law regarding arms length leases comes to play.. And you can stabilize and secure the home.. But any improvements are at your risk.. the redeeming party just owes you your cash plus in our state 9% and any VERIFIABLE expenses you paid to protect the asset.
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