Help with owner and encumbrance report

13 Replies

I am interested in a foreclosure auction and had a PRELIMINARY TITLE REPORT ran on the property.
However i am having trouble understanding it. I XXXX'd out the names:
Can someone dumb this down for me?
Outside the costs of the auction will i be held responsible for costs?

Here is what is listed on the Mortgage/Leins section:


1. A deed of trust to secure an indebtedness in the amount shown below, and any other obligations secured

thereby

Dated: November 14, 2005

Amount: $240,000.00

Trustor/Borrower: XXXXX

Beneficiary/Lender: Mortgage Electronic Registration Systems, Inc. solely as nominee for GMAC

MTG, its successors and assigns

Recording Date: November 22, 2005

Instrument No.: 119543, of Official Records.

An assignment of the beneficial interest under said Deed of Trust as follows:

Assigned To: Ocwen Ln Servicing LLC

Recording Date: August 01, 2014

Instrument No.: 40049, of Official Records.

An assignment of the beneficial interest under said Deed of Trust as follows:

Assigned To: Select Portfolio Servicing

Recording Date: March 13, 2017

Instrument No.: 15015, of Official Records.

An assignment of the beneficial interest under said Deed of Trust as follows:

Assigned To: Select Portfolio Servicing

Recording Date: March 16, 2017

Instrument No.: 15998, of Official Records.

2. A deed of trust to secure an indebtedness in the amount shown below, and any other obligations secured

thereby

Dated: June 26, 2007

Amount: $90,000.00

Trustor/Borrower: XXXXX

Beneficiary/Lender: Mortgage Electronic Registration Systems, Inc. solely as nominee for GMAC

MTG LLC, its successors and assigns

Recording Date: July 31, 2007

Instrument No.: 64922, of Official Records.

An assignment of the beneficial interest under said Deed of Trust as follows:

Assigned To: 21st MTG Corp

Recording Date: August 11, 2017

Instrument No.: 47173, of Official Records.

The property in question has two loans outstanding.  Or, at least they appear to be outstanding from the information you posted.  The first had an original loan amount of $240K and was made on 11/14/2005.  The loan was entered into MERS (Mortgage Electronic Registration Systems, Inc) which is a big system that tracks loans.  I think its still in use, but folks pointed fingers at that as part of the whole financial meltdown.  The second mortgage was for $90K on 6/26/2007.  Both appear to have changed hands.  Both were originally done by GMAC mortgage.  The first was sold to OWCEN, then Select Portfolio Servicing.  The two back to back assignments to Select Portfolio Servicing probably had some error on the first that the second assignment corrected.  The second mortgage was sold to 21st Mortgage.  These may have been actual sales of the loan or may have just been changes in the servicer.  Often one company services loans that are held by someone else.

Which loan is foreclosing?  The process is somewhat state specific, but typically if the first was foreclosing the second would be wiped out.  If the second is foreclosing the first would remain in place.  Are there any other liens or encumbrances?  Some liens, e.g., IRS liens, will be superior even to the first.

Thanks for the response Jon!
I am not sure which of the two loans is foreclosing?
Is there a easy was to find that out. It dosn't seem to be very clear on the auction site.

This may sound like a stupid question but i need to ask it for his to all make sense to me.
So lets just assume that Loan #1 is foreclosing. If i win the auction at $150k. I would just owe the lender $150k and the 240K forclosed loan just goes away along with the 2nd 90k loan? Or would i still owe a balance of whats left due after the $150k is paid at the end of the auction? 

This looks like it could be FL. Look at the LP (lis pendins) filing (which should have shown up in the search).
The LP says Who is filing foreclosure and sometimes list the recording date/no. for the mtg being foreclosed on. And of course, the final judgment amount will give you a clue.

What kind of auction is this?  The actual foreclosure auction?  AKA a "sheriff sale"?  If you win that sort of an auction then you pay your winning bid and any fees and you get possession of the property.  If its the second that's foreclosing, the first mortgage remains in place and due in full.  You would either have to pay that off or risk losing the house when the first forecloses.  If its the first that's foreclosing the second is eliminated by the sale.  The winning bid (plus fees) is all you pay.  The foreclosing mortgage is eliminated.

You don't say where you are and that matters a lot.  Some state have complex upset and redemption rules that come into play after the auction.

If this is some commercial auction site, who knows what's going on.

Bidding at auctions is not for the feint of heart. This could be someone else foreclosing. Could be an HOA, which might or might not wipe out the first and second. Could be a contractor.

For your last REO questions: yes, and yes.
Remember, HOA debts in FL become yours whether or not a lien is filed and check for current/past property taxes.

Originally posted by @Robert Harris :
Originally posted by @Tom Gimer:
Originally posted by @Robert Harris:

Its an Auction.com listing

Auction page

"The seller took ownership of this property at a recent foreclosure auction. "

REO.

The title on an REO is typically clean right?

Eh.

Of course it should be but the lender/seller doesn't have knowledge of everything affecting the property and the odds of something surfacing regarding an REO are increased.

Get a warranty deed and buy owners title insurance.

If this is the auction you are bidding:https://www.auction.com/details/2500-adirondack-tr...

then it says" Special warranty deed". This is good news

IT shows as "OCCUPIED". Have you visited the property? ARe the occupants still there but the auction is listed as occupied? IF someone is there find out if they are previous owners or rentors. You may probably have to set aside $$ for "Cash for key". I expect around 2K based on the value of the property. Check if the property is maintained well from outside. If not you can expect the same inside. Check the "Cost rider" in the auction.com attached docs and add the numbers up for gauging your expenses.