Flipper · Honesdale, PA · Member since 2012 · 14 posts · 0 votes
Anybody ever bid a foreclosure that had former owner-occupants still in the home? BAC has one in my area, but states "do not knock on door", as is, no inside views allowed. Did a drive by. Two cars in driveway, people living there. Have bought lots of foreclosures, but never had this issue come up before.
If I bid and get the property, how do I go about removing the "squatters"? Sheriff, police, etc???
hi kevin. If they are indeed the owner occupants it's a little easier than if they are renters. Renters have a shield in the "protecting renters in foreclosure act" passed in 2008 that allows them 90 days to vacate, and at least in California some judges view the law as regardless of whether they pay rent to the new owner or not. I have assumed I was dealing with an owner occupant on two different foreclosures only to find out they had moved in a renter last minute, so you have to watch out. Even if it's owner occupied it can be a costly hassle to go through the legal process. (Have to get a court order before the Sherriff gets involved and it could be one to several months to get through)
My recommendation is to factor in a "cash for keys" price in your bid. Occupants will often move out if you offer them incentive and it's all negotiable. Best thing to do is talk to them once you own the property and feel them out, then make a proposal, ie "I'll give you this much if you are out by this time". Sometimes offering things like helping with the move, storage, etc would go a long way, as some people who have been foreclosed on are just scared to death and don't know what to do.
Keep in mind that you don't owe them anything, but with the hassle of litigation and the possible huge expense associated with holding costs, you can see it as a cost of doing business. Some others may not want to deal with it and that may make it a better deal for you.
Sounds like an auction.com REO auction. My usual response to the "do not disturb, illegal trespass...." is to simply knock on the door, with a respectful attitude, ask them their plans, and go from there. It's amazing what surprises you may learn, along with a peak inside of course. I'm pretty sure auction.com can't take away my birthday.
Ended up not bidding on it. Picked up another house in general area without "occupants" (have flipped more during the year). I do appreciate your response and will keep it in mind if I do bid an "occupied" foreclosure.