Pre Foreclosure - Paying off balance and acquire property

[Rod Govea]

Hello BP nation, looking at county assessor's office and properties that are scheduled to be foreclosed.

There is one in particular where the outstanding balance states roughly $35K.  I know the property is worth much more than that, so here are my questions:

1) Is the assessor's office required to show all existing liens or is it likely this balance just represents the 1st lien and others are existing? 

2) The county shows the attorney's office representing the lien holder (bank).  If I called them interested in paying off the balance in order to adquire, would they discuss that with me?

Please comment if you have experience in this arena and can provide insightful information.

Thanks in advance!

Rod

[Elizabeth Wilson]

Hey @Rod Govea. Colorado might be different but in Tennessee the Register of Deeds records all of them. Ask around at your local REIA; I'm sure someone there would know for sure.

Neither the bank nor the attorney will discuss the loan with anyone other than the homeowner and anyone the homeowner designates.  Your first move has to be contacting the homeowner to see if they'd be willing to let you talk to the bank regarding this. Otherwise you just have to wait until auction date.

[Chris Seveney]

Rod Govea
They show the outstanding principal amount but that is not the total payoff. The unpaid principal balance is the amount interest accrues off of but then there will be legal fees, escrow advances, penalties etc that get tacked on.

As an example I have a note that has a UPB if $65k but total payoff is $140k.

[Bill S.]

@Rod Govea so there a few possible scenarios. Most likely is that the loan being foreclosed is in 2nd or 3rd position. A loan in 2nd position can foreclose and obtain title for the property subject to the loan in the 1st position.

Only title work can determine the order of liens. You can purchase what is known as O and E (ownership and encumbrances) from a title company. It's basically title light and it will give you an idea of lien situation. 

It's possible that the loan being foreclosed is in the first position. It's highly unlikely that it will make it to the sale. Those that specialize in the chasing foreclosures (and some that don't) will be knocking on the owner's door.  

The attorney for the bank in the foreclosure will not give you the time of day.

[Ron S.]

...and the only way you're going to get the total balances due are when they publish for sale. Even then, that balance is only a snapshot in time as there is daily per diem interest.

O&E only shows the recorded amounts, not the balances. There is NO source available to anyone for current balance information outside of the servicer and borrower (Even the trustee/attorney only knows the reported debt amount). You can read all day about lists that people subscribe to, to know what the balances are. Those are called credit reports (yes...being smart here) and if you have a credit report on a borrower, for a property you are interested in, you didn't obtain it legally. Not saying anyone here is doing that, I'm just saying that if anyone was, they would not be doing it legally.

[Rod Govea]

Thanks all, appreciate the input.