Unusual Foreclosure Situation

19 Replies

Hi all,

This is a long story and not sure if this is the right place to ask about my situation, but here goes.

About a year ago my mother passed away. My mother and step-father were both on a fixed income and barely making ends meet each month. After her passing, there was no way my step-father could pay his 2 mortgages plus other bills.

I ended up moving in with my step-father to help him with his bills and give me a place to stay while I did some major renovations to my home (gutting kitchen and both baths).

Well a few months later he passes away. Now I'm living in his house and my house is basically unlivable due to the kitchen and baths being completely tore apart.

I've been living in his house (only paying utilities) for the past four months while trying desperately to complete a bathroom so I can move back in and out of his house. I'm still a few weeks at best from getting to a point where I have a working bathroom and the foreclosure process is starting on his house.

I'm worried that his house will get seized or sold before I can get out of it.

Any advice? Thanks a bunch! 

Do you care what happens to the home meaning are you planning on letting the bank foreclose or take the home back?  Who is the executor in charge of his estate? 

If you dont care what happens then dont worry about it as I dont think anything will happen fast enough.  Sounds like you will be home in no time.

Curt Davis, Real Estate Agent in TN (#00321765)

Sorry to hear so you are dealing with so much in such a short period.  

Is it the bank that is foreclosing or is it the county foreclosing for past due property taxes? Foreclose by a lender in VA is non judicial (no court case). It appears to be relatively fast, taking only 4 months. But there are several notices that the lender has to give you. What's the last notice you received and what did it say? Does it have a sale date on it? The house won't be seized. It will be sold at public auction. It will either be bought by a bidder at the sale. Or, if no oner bids enough, the property will go to the lender. Either way, after the sale the new owner will give you notice to leave or be evicted.

The foreclosure aside, what's the value of the property and what are the loan amounts?  Is the property worth saving from foreclosure?

Hi Curt, thank you for your reply. I'm letting the bank foreclose. At the moment there is no executor of his estate. I've spoke with the city probate clerk about becoming administrator of his estate, but since I'm not a blood relative and not his next of kin it's been a bunch of jumping through hoops.

It's been a challenge trying to do anything regarding his affairs, because of course no one will talk to me without the admin designation.

Hi K.Marie Poe, thank you for your reply. It is the bank that is foreclosing. My step-father has received a letter from a lawyer that pertains to a Motion for Relief From Stay. I think he filed for bankruptcy several years ago. There was supposed to be a hearing on this matter June 5, 2015. I spoke with this lawyer and they just said they were taking care of everything. I didn't tell them I was still living in the home. I asked how long before the house was seized/sold and she just said it depends on the bank.

There was a notice from the post office in the mail yesterday saying there was a certified letter to be picked-up for my step-father. Problem is I doubt I can pick it up because I don't have admin rights yet. I'm guessing this letter is probably the foreclosure notice or sale date. 

It would be nice to know if I had days, weeks, or months. Thanks! 

Take the notice and pick up the certified letter.  They don't ask for ID.

I think what we're missing here is understanding what you really want.

Are you trying to save the house from foreclosure or fix it? Either suggests you want to remain there. 

Actions your stepfather took by filing bankruptcy are now moot and no longer help. The prior action might even have made things more difficult if a large amount of back payments were in a repayment plan that would likely require payment now.

As for gaining control of his estate, you need to decide if it makes sense (if there is lots of equity remaining after payment of debts) and if you are the best choice for resolving this, especially if you have the financial resources and understanding to resolve.

If you don't think you are up to these challenges, you won't have to be concerned with either repairing the house or the debt. Also, you'll have several weeks or more warning prior to being evicted. If you can't change that, you'd might as well ficus on your job situation and if you will be relocating locally or to a new community.

Originally posted by @Wayne Brooks :

Take the notice and pick up the certified letter.  They don't ask for ID.

My experience is the same as Wayne's.  I sign for certified mail addressed to others that comes to my PO Box (my husband, my daughter) and I'm never asked for ID.  I doubt the USPS employees think my name is Scott.  

I would definitely try to pick up the letter so you can see what the notice is.  Then you can better determine the current stage/status of the foreclosure.

That being said, if it's your goal to leave the property voluntarily and not be evicted I suggest getting on the minimal necessary repairs and utilities turned on to make your gutted home livable asap. I'd also have a garage/estate sale and move anything you are taking with you asap, like this weekend. If the lender is asking for a lift of stay the foreclosure process is not starting at the beginning. It sounds to me like the sale date will be sooner rather than later.   

For anyone looking for deals....maybe...just maybe you should reread this and see what his problem is. ( Me Included ) I did it twice.  He even says it.

Originally posted by @Mike Osterman :

For anyone looking for deals....maybe...just maybe you should reread this and see what his problem is. ( Me Included ) I did it twice.  He even says it.

I'll bite.  What do you think the problem is? 

I see a house with little equity (per my research) owned by an intestate decedent.  Been there done that.  :)  I see a gutted house that doesn't appear to be for sale.  What do you see?


It's been a challenge trying to do anything regarding his affairs, because of course no one will talk to me without the admin designation

For someone WITH equity (or interest) that would be cool.

This guys just trying to figure out if he has anything. This is the mindset of a seller I want to talk with. 

Originally posted by @Mike Osterman :

It's been a challenge trying to do anything regarding his affairs, because of course no one will talk to me without the admin designation

For someone WITH equity (or interest) that would be cool.

This guys just trying to figure out if he has anything. This is the mindset of a seller I want to talk with. 

Yup, equity makes a deal worthwhile.  But equity doesn't solve the problem that the OP doesn't necessarily have anything to sell.  He is a step son, likely not adopted.  The decedent has other living heirs.  Checked that too.  Maybe there was a will that we don't know about?  Maybe the heirs want to sell their interests? I shouldn't have said there was no equity.  There is a little.  But the decedent had a Ch. 13 plan that wasn't completed before he died.  So opening a probate exposes the equity to those unpaid creditors.  No thanks!

Originally posted by @Mike Osterman :

  Wanna Look at some with equity? @K. Marie Poe I've got dead ends, I'd love to partner on.

Dead leads are often dead for a reason.  Heirs that won't sell their interest or won't get involved is always a good one.  Multiple heirs can be a deal breaker.  The dreaded but oh so real Medi-Cal debt.  

That being said, if a property is not in foreclosure and the estate is not yet opened, the competition is minimal.  

Send 'em over.

Originally posted by @Mike Osterman :

For anyone looking for deals....maybe...just maybe you should reread this and see what his problem is. ( Me Included ) I did it twice.  He even says it.

First, to the OP, my condolences for your losses.

 Maybe my view is skewed, but I see a non relative home occupant who wants to have as much free "time" in a property he doesn't own before its foreclosed on so he can live rent free while he finishes the work on his own home. He states so twice in this thread that I can recall.

The questions for the asker that would be helpful to those trying to analyze the situation (and maybe help one another should the OP and an investor collaborate) are:

1. What's the house worth (ARV)

2. What are any physical issues with the property, besides the foreclosure.

3. How much debt is on the property now

4. What are the arrears mortgage payments, property taxes, hoa, etc

The answers to these questions might prompt some investors to have some interest in looking into this property as an opportunity, or not. In any event, the answers would certainly allow this analysis 'exercise' to pay dividends. 

Originally posted by @Christopher Telles :
Originally posted by @Mike Osterman:

For anyone looking for deals....maybe...just maybe you should reread this and see what his problem is. ( Me Included ) I did it twice.  He even says it.

First, to the OP, my condolences for your losses.

 Maybe my view is skewed, but I see a non relative home occupant who wants to have as much free "time" in a property he doesn't own before its foreclosed on so he can live rent free while he finishes the work on his own home. He states so twice in this thread that I can recall.

The questions for the asker that would be helpful to those trying to analyze the situation (and maybe help one another should the OP and an investor collaborate) are:

1. What's the house worth (ARV)

2. What are any physical issues with the property, besides the foreclosure.

3. How much debt is on the property now

4. What are the arrears mortgage payments, property taxes, hoa, etc

The answers to these questions might prompt some investors to have some interest in looking into this property as an opportunity, or not. In any event, the answers would certainly allow this analysis 'exercise' to pay dividends. 

Normally I'd agree that the important info is ARV, debt, and condition. BP posts can be frustrating because the relevant info is often left out. However, when you are dealing with a decedent with an incomplete Ch. 13 BK? It's pretty messed up. The question isn't house debt and ARV, but rather estate assets and estate debt. And type of creditors. Estate value has to be such that it's worth probating to transfer title. Unpaid Ch. 13 creditors are known creditors so they would have to notified as part of any probate action. On this one I think it's a deal killer.

Ch. 13 is only possible for debtors with enough documentable income to support a payment plan.  The BK trustee doesn't evaluate if the debt makes sense in the long run.  It's often used to avoid foreclosure, but many payment plans are not completed because the debt doesn't make sense (or the income disappears).  Or, in this case, the debtor dies.  The decedent would have filed a Ch. 7, which would have wiped out the non-house debt, if he and his wife had no equity.  But they did, and the Ch. 13 prolonged the inevitable.

Originally posted by @Christopher Telles :
Originally posted by @Mike Osterman:

For anyone looking for deals....maybe...just maybe you should reread this and see what his problem is. ( Me Included ) I did it twice.  He even says it.

First, to the OP, my condolences for your losses.

 Maybe my view is skewed, but I see a non relative home occupant who wants to have as much free "time" in a property he doesn't own before its foreclosed on so he can live rent free while he finishes the work on his own home. He states so twice in this thread that I can recall.

The questions for the asker that would be helpful to those trying to analyze the situation (and maybe help one another should the OP and an investor collaborate) are:

1. What's the house worth (ARV)

2. What are any physical issues with the property, besides the foreclosure.

3. How much debt is on the property now

4. What are the arrears mortgage payments, property taxes, hoa, etc

The answers to these questions might prompt some investors to have some interest in looking into this property as an opportunity, or not. In any event, the answers would certainly allow this analysis 'exercise' to pay dividends. 

 Hi Christopher Telles,

Thank you for the condolences, much appreciated.

Your view is appreciated, and in the eyes of the law I am considered a non-blood relative. Getting a bit too personal here perhaps, but the guy was my step-father for over 26 years and was in my life much more than my birth father.

I'm not looking for a free ride here. I purchased a home and began renovating it while I stayed with my step-father. I helped him keep up with his bills (while also paying my own) after the loss of my mother's income. He passed away while I was in the middle of the mentioned renovations. Call it bad timing, I guess, but when is there ever a "good" time?

After his passing I was stuck. I couldn't really live in my home due to the fact I basically do not have any running water (or lack of fixtures to facilitate running water). That's awesome for the water bill, terrible for hygiene.

Anyway, to answer your questions about the property the best I can:

1. The house could probably go in the range of $150,000 - $160,000. Great neighborhood, good schools, conveniently located to shopping, schools, military bases, etc.

2. The house is in pretty good shape. Hardwood floors through out (they do need refinishing though) roof about 7 years old, central HVAC about 3 years old, windows about 5 years old, and 2 skylights. It's 3 bdrms, 2 full baths, and about 1485 sq ft sitting on a total of .21 acres according to city records. In my opinion it needs some updating in the kitchen and hallway bath, but that would be me if it was mine. Biggest issues I see with the home from a home inspection standpoint would be the lack of insulation in the crawlspace and the dryer vent blows out into the crawlspace.

3. Last time I spoke with my step-father (late January) about what he owed it was around $85,000 between 2 mortgages.

4. Property taxes are up to date as of June 5, 2015, but arrears on the mortgages are probably somewhere in the neighborhood of $6500 total.

Thank you for your input!

Originally posted by @Tee Riddle :
Originally posted by @Christopher Telles:
Originally posted by @Mike Osterman:

For anyone looking for deals....maybe...just maybe you should reread this and see what his problem is. ( Me Included ) I did it twice.  He even says it.

First, to the OP, my condolences for your losses.

 Maybe my view is skewed, but I see a non relative home occupant who wants to have as much free "time" in a property he doesn't own before its foreclosed on so he can live rent free while he finishes the work on his own home. He states so twice in this thread that I can recall.

The questions for the asker that would be helpful to those trying to analyze the situation (and maybe help one another should the OP and an investor collaborate) are:

1. What's the house worth (ARV)

2. What are any physical issues with the property, besides the foreclosure.

3. How much debt is on the property now

4. What are the arrears mortgage payments, property taxes, hoa, etc

The answers to these questions might prompt some investors to have some interest in looking into this property as an opportunity, or not. In any event, the answers would certainly allow this analysis 'exercise' to pay dividends. 

 Hi Christopher Telles,

Thank you for the condolences, much appreciated.

Your view is appreciated, and in the eyes of the law I am considered a non-blood relative. Getting a bit too personal here perhaps, but the guy was my step-father for over 26 years and was in my life much more than my birth father.

I'm not looking for a free ride here. I purchased a home and began renovating it while I stayed with my step-father. I helped him keep up with his bills (while also paying my own) after the loss of my mother's income. He passed away while I was in the middle of the mentioned renovations. Call it bad timing, I guess, but when is there ever a "good" time?

After his passing I was stuck. I couldn't really live in my home due to the fact I basically do not have any running water (or lack of fixtures to facilitate running water). That's awesome for the water bill, terrible for hygiene.

Anyway, to answer your questions about the property the best I can:

1. The house could probably go in the range of $150,000 - $160,000. Great neighborhood, good schools, conveniently located to shopping, schools, military bases, etc.

2. The house is in pretty good shape. Hardwood floors through out (they do need refinishing though) roof about 7 years old, central HVAC about 3 years old, windows about 5 years old, and 2 skylights. It's 3 bdrms, 2 full baths, and about 1485 sq ft sitting on a total of .21 acres according to city records. In my opinion it needs some updating in the kitchen and hallway bath, but that would be me if it was mine. Biggest issues I see with the home from a home inspection standpoint would be the lack of insulation in the crawlspace and the dryer vent blows out into the crawlspace.

3. Last time I spoke with my step-father (late January) about what he owed it was around $85,000 between 2 mortgages.

4. Property taxes are up to date as of June 5, 2015, but arrears on the mortgages are probably somewhere in the neighborhood of $6500 total.

Thank you for your input!

Yeah, sometimes I'm to direct to the point. Sorry if that came off as insensitive. 

I personally don't have any experience with the bankruptcy courts, but as @k.mariepoe points out in one of her replies any opportunity may be subject to bk process and then approval. Are you wanting to try to retain the property as an investment? You might be able in a better position than many others to either buy it from the estate or assist the estate in finding a viable way out of the foreclosure by a) buying it from the estate or b) arranging its sale to an investor (and hence earning something for the efforts).

There seems to be some equity there to work with initially, assuming there aren't any other creditors with claims in the bk petition.

Originally posted by @Tee Riddle :
Originally posted by @Christopher Telles:
Originally posted by @Mike Osterman:

For anyone looking for deals....maybe...just maybe you should reread this and see what his problem is. ( Me Included ) I did it twice.  He even says it.

First, to the OP, my condolences for your losses.

 Maybe my view is skewed, but I see a non relative home occupant who wants to have as much free "time" in a property he doesn't own before its foreclosed on so he can live rent free while he finishes the work on his own home. He states so twice in this thread that I can recall.

The questions for the asker that would be helpful to those trying to analyze the situation (and maybe help one another should the OP and an investor collaborate) are:

1. What's the house worth (ARV)

2. What are any physical issues with the property, besides the foreclosure.

3. How much debt is on the property now

4. What are the arrears mortgage payments, property taxes, hoa, etc

The answers to these questions might prompt some investors to have some interest in looking into this property as an opportunity, or not. In any event, the answers would certainly allow this analysis 'exercise' to pay dividends. 

 Hi Christopher Telles,

Thank you for the condolences, much appreciated.

Your view is appreciated, and in the eyes of the law I am considered a non-blood relative. Getting a bit too personal here perhaps, but the guy was my step-father for over 26 years and was in my life much more than my birth father.

I'm not looking for a free ride here. I purchased a home and began renovating it while I stayed with my step-father. I helped him keep up with his bills (while also paying my own) after the loss of my mother's income. He passed away while I was in the middle of the mentioned renovations. Call it bad timing, I guess, but when is there ever a "good" time?

After his passing I was stuck. I couldn't really live in my home due to the fact I basically do not have any running water (or lack of fixtures to facilitate running water). That's awesome for the water bill, terrible for hygiene.

Anyway, to answer your questions about the property the best I can:

1. The house could probably go in the range of $150,000 - $160,000. Great neighborhood, good schools, conveniently located to shopping, schools, military bases, etc.

2. The house is in pretty good shape. Hardwood floors through out (they do need refinishing though) roof about 7 years old, central HVAC about 3 years old, windows about 5 years old, and 2 skylights. It's 3 bdrms, 2 full baths, and about 1485 sq ft sitting on a total of .21 acres according to city records. In my opinion it needs some updating in the kitchen and hallway bath, but that would be me if it was mine. Biggest issues I see with the home from a home inspection standpoint would be the lack of insulation in the crawlspace and the dryer vent blows out into the crawlspace.

3. Last time I spoke with my step-father (late January) about what he owed it was around $85,000 between 2 mortgages.

4. Property taxes are up to date as of June 5, 2015, but arrears on the mortgages are probably somewhere in the neighborhood of $6500 total.

Thank you for your input!

@douglasdowell

Any thoughts on this situation?

Originally posted by @Tee Riddle :

Hi K.Marie Poe, thank you for your reply. It is the bank that is foreclosing. My step-father has received a letter from a lawyer that pertains to a Motion for Relief From Stay. I think he filed for bankruptcy several years ago. There was supposed to be a hearing on this matter June 5, 2015. I spoke with this lawyer and they just said they were taking care of everything. I didn't tell them I was still living in the home. I asked how long before the house was seized/sold and she just said it depends on the bank.

There was a notice from the post office in the mail yesterday saying there was a certified letter to be picked-up for my step-father. Problem is I doubt I can pick it up because I don't have admin rights yet. I'm guessing this letter is probably the foreclosure notice or sale date. 

It would be nice to know if I had days, weeks, or months. Thanks! 

 Here's the info about your question:

"Depending on the timing of the various required notices, it usually takes approximately 60-90 days to effectuate an uncontested non-judicial foreclosure. This process may be delayed if the borrower contests the action in court, seeks delays and adjournments of sales, or files for bankruptcy." - source: Foreclosure.com

Virginia is non judicial foreclosure state. If you don't contest the foreclosure or if this case does not have to go through probate, then you have 3 months max.