Minnesota sheriff sale, foreclosure, bankruptcy guidance

Minnesota sheriff sale, foreclosure, bankruptcy guidance

Lender · Sioux Falls, SD · Member since 2016 · 26 posts · 20 votes
I'm so glad for BiggerPockets and the help we can get here. I'm in need of some guidance. My girlfriend and her husband got a divorce. The court ordered him to sell the property. Instead, he let it go into foreclosure, then declared bankruptcy. She has been drug through all of this too and her credit is shot, as is her mental and physical health. She wants me to buy the property, finish the rehab, then sell it. She has two months left of her redemption period, she thinks. She's literally been an ostrich with her head in the sand because this is too much for her. But she wants to get something out of the property somehow, so she's proposed that she manage the rehab for me since the property is an hour away from me, then be paid something for her time after the property is sold at market price. So here are my questions: 1. The property is in Goodhue County, MN. Where/how can I find out when the sheriff's sale was and the amount that was paid? In other words, how can I find out what I should pay to buy the property? 2. Since the husband declared bankruptcy, does he have any title rights? 3. Would it even be legal for her to be involved in the rehab and receive payment after the sale? 4. Should I run away as fast as I can from this, or am I being given an opportunity? I don't know enough about REOs and bankruptcy to even know the right questions to ask. Any guidance would be very much appreciated. Thanks in advance! Melanie
0Reply
19 views

9 Replies

Jump to latestLatest
  • Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    9y

    A mess for sure.  We don't have redemption here, but my understanding is that if redeemed, it goes back to as if the property was not foreclosed on....the husband is still on title, regardless of any BK.  You should be able to google up that county's recorder/property appraiser sites.

  • Investor · Rochester, MN · Member since 2016 · 80 posts · 37 votes
    9y

    I am from Rochester, MN and the market is so hot here it is crazy.  Rochester is in the next county to Goodhue. Unless you think you can figure this out with confidence, I would walk away from this.  Getting involved in something with some fuzzy pieces may be asking for trouble.  But if you can answer all your questions and feel like your friend can do the job it may be a win win.

    If you wanted to venture on figuring this out, I would call the county office and get the information about price and details of the sale from them.  Also they may know the answers to your other questions or point you in the right direction to get those questions answered.  

    Make sure you have everything in writing on how much she is getting if she does manage the rehab.  Also if she has her head in the sand, is she going to be capable of running the project?  Especially since she will be working on the house she had with her ex. When she has so many emotions going on, will she be able to get things done?  Even without the emotion, is she one to get things done and find the best deal.  It is always nice to help friends but doing business with them doesn't always work with their personality.

    The questions you are asking sound like a great start.  Now to find the experts who can answer technical questions.  I wish you all the luck.

  • Investor · Minnetonka, MN · Member since 2016 · 123 posts · 86 votes
    9y

    Hi @Melanie Raine. This is a nasty situation and I agree with @Jessica Grewe that your friend may be too close to the situation to do a good job at it, even if she has the skills to manage the rehab.

    This page discusses tax forfeited properties, but there are some contact numbers there where you may be able to get answers to your questions: http://www.co.goodhue.mn.us/196/Forfeited-Land-Gen...

    This site answers a bunch of questions about foreclosures in MN: http://www.winthrop.com/news_events/winthrop_news/...

    If you decide to proceed, I know of a couple of contractors in the Canon Falls and Nestrand area that work in Goodhue County that I could put you in contact with. They have done both new construction as well as rehab work, including purchasing foreclosures. PM me if you would like their contact information.

  • Lender · Sioux Falls, SD · Member since 2016 · 26 posts · 20 votes
    9y

    Thank you, all. Very good information that's been offered and very much appreciated. I agree, too, about my friend's emotional attachment. It's so hard with friends to keep things strictly business. You know, I'm usually pretty tech savvy, but finding the sheriff's sale information online has totally eluded me. I'll try calling later today. My friend seems to think I can buy her property for what was paid at the sheriff's sale plus fees. I have my doubts about that; not sure she's been given accurate information. I also have my doubts about whether the title is clear, and I don't know if her ex's bankruptcy has removed his rights. At the time, it was his primary residence but it's not any more. He has vacated completely. Messy situation, indeed. But I'll keep forging ahead, for the learning opportunity if nothing else. I've been taught in all the guru classes that you keep going until you get three NOs. And Robert Kiyosaki says to never think it can't be done; rather, always think HOW can I get this done. So -- onward! @Scott S., if I get it that far, I'll definitely be contacting you.

    Additional comments / suggestions / concerns are quite welcome!

  • Investor · Rochester, MN · Member since 2016 · 80 posts · 37 votes
    9y

    Could you let me know if the owner can buy her property for what was paid at the sheriff's sale plus fees and how long they have before they can't anymore.  Also let me know what you learn about the  ex's bankruptcy having removed his rights.

    I am always interested in learning.

  • Lender · Sioux Falls, SD · Member since 2016 · 26 posts · 20 votes
    9y
    Will do, Jessica.
  • Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    9y

    BK does not remove someone from title, only the personal obligation on the debt.

  • Rental Property Investor · Mankato, MN · Member since 2015 · 47 posts · 13 votes
    9y

    Take your own advice here:

    4. Should I run away as fast as I can from this

    I don't even know what the numbers are and I cant forsee this ending well.

  • Investor · Crystal, MN · Member since 2013 · 486 posts · 277 votes
    9y

    @Melanie Raine

    A couple thoughts:

    1) Since the property has been sold at the Sherrif's sale, the foreclosing bank now owns the property.  The person who commented that the bankruptcy does not affect tile is not accurate.  It is immaterial, other than that person destroyed their credit for 7 years.

    2) The redemption means your friend can buy the house back, but that can only be done with full payment for the note, plus  fees and any interest.

    3) You as a third party could approach the bank and offer to buy the property for cash. It is important that you realize, though, there is no mortgage anymore. When the bank bought it, the mortgage went with it...you cannot offer to catch up the payments. The bank will be under no obligation to you at all to agree to sell the property to you. And, getting a hold of an REO officer assigned for a property not yet through redemption could be work.

Join the conversationCreate a free account to reply, vote on answers and follow this thread.