Involved In Real Estate · Jacksonville, FL · Member since 2012 · 217 posts · 42 votes
I had someone bring up an interesting business plan after my recent trouble with purchasing a HOA lien that was thought to be a first mortgage. The idea would be to purchase HOA Liens and then rent the property out till the first mortgage is foreclosed. As long as the first mortgage foreclosure process was not started there should be about a 2-3 year window to cover the cost of the lien and make a profit. The tenant would be protected by having a long term lease in case the bank foreclosed earlier than expected. I thought it was a creative way of making money with the foreclosure mess. What are the problems with it?
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
14y
Tim Czarkowski You are in a judicial foreclosure state which is totally different from my experiences in CA. I'm curious that the attorneys are saying that you won't be noticed of a pending foreclosure. I thought everyone was named and served in a judicial foreclosure suit: jr lenders, lienholders, borrowers and any owners of record. In fact, how could it be otherwise? I'd check further into that. Maybe you mean something different by noticing. Indeed, the senior lenders don't have to communicate with you as the new owner via a foreclosure. You haven't yet checked for a lis pendens? Or is this for property to be purchased in the future?
I find it hard to believe that lenders in FL have no recourse to recover collateral other than a 3 year foreclosure process. Is that because of a backlogged court system? So does that mean borrowers in FL are just taking a 3 year break from paying for housing?
Real Estate Investor · Audubon, PA · Member since 2009 · 13k+ posts · 8k+ votes
13y
You're probably not looking to purchase the HOA lien itself - you're wanting to purchase the foreclosure of the HOA lien, which would usually be held in some public auction. In my area, that would be at a sheriff sale.
Investor · Chicago, IL · Member since 2013 · 2k+ posts · 1k+ votes
13y
Tim Czarkowski, my real estate partner has bought several HOA foreclosures in FL and making a killing on it. However, with the "speedy foreclosure" law in FL, the ROI on these types of investments might be in jeopardy.
Involved In Real Estate · Jacksonville, FL · Member since 2012 · 217 posts · 42 votes
13y
Wendell De Guzman Yes it will be interesting to see what happens as the law takes effect. Personally the slow process seems good for me. Even with as slow as the process is there are still many more properties than I can currently hope to purchase. The speed up may allow a higher ROI but for a much shorter period of time.
Did you hear about that case down in Fort Lauderdale (Maybe Miami? don't remember for sure) where the HOA was awarded a 1.5 million dollar condo because the bank missed filling their foreclosure before the 5 year statue of limitations?
Involved In Real Estate · Jacksonville, FL · Member since 2012 · 217 posts · 42 votes
13y
JOSE LOPEZ Here and in most counties in Florida the foreclosure auctions are held online by the company REAL Foreclose. The web address are different for each county so I don't know what it is but you should be able to figure it out pretty easy with a little work on Google. I would suggest you do as much research as you can before you go and start bidding on things. It does not sound like you know much about the process.
Buddy you are not protected from the bank at all regardless of your lease and the term. The tenant has only Ninety (90) days after the bank obtains title, which is what the statue reads. He or she has the option to take "cash for keys" which is usually ******** in terms of dollars, usually a couple of thousand, or ride out their ninety days, at whatever their lease is, if the lender feels that it is too low, they can charge market rent and raise it accordingly. [removed phone number]