I am new to sheriff's sale but not new to real estate. I have purchased dozens of home without interior access through auction.com, hubzu, xome and I know there are guys making a living at the courthouse steps so I finally decided it was time I start going. I have someone on fiverr running title searches and they do a great job so I understand the risk with these properties.
I went to my first sheriff's sale to listen and learn but here are some follow up questions.
1. I told one of the bidders there which houses I was interested in. He said the bank will probably buy that one back. Does that mean some of the bidders down there represent the bank or are banks just putting a reserve.
2. I heard a couple people open the first bid up with "Plantiff" - What does this mean.
3. Lake County Ohio starts the bid at 2/3 the listed appraised value. But sometimes the listed mortgage is considerably higher then the ending bid. Are these properties being sold if they dont satisfy the mortgage?
4. On the property page link below - there are 5 categoris for the status of a given property. ACTIVE/CANCELLED/BANK/PRIVATE/BANK PLTF - What does bank,private, and bank pltf mean?
@Adam Craig Every state is different in how they conduct their sales and I'm not experienced with OH so these are general and best guess answers based on my experience with foreclosures in other states:
1. In general, a lender can set the opening bid anywhere below the total amount owed (unpaid principal balance plus arrearages and FC costs). They can also instruct the auctioneer to credit bid on their behalf up to a certain number. For example: Property market value: $200k, Total Debt: $300k, Opening Bid: $120k, Credit Bid: $150k. Auction starts at $120k. When there is only one bidder left, the auctioneer will bid on behalf of the lender until $150k. After that point, it will go to the highest 3rd party bidder above that. You will not know what the credit bid (or reserve amount) is. The comment about the "bank buying that one back" probably means that the lender set the opening bid too high and no 3rd party will bid on the property. Again, each state is different so what I stated above is subject to change depending on the specific procedures of that state.
2. Plaintiff equals lender in judicial foreclosure states. Defendant equals borrower.
3. The lender can choose to accept less than the total debt to satisfy the obligation. Once they go to the foreclosure sale, the property either gets sold to a third party or reverts back to the lender as REO.
4. I didn't click on your link so just making a best guess: bank means it reverted back to the lender at sale. private probably means the property sold to a 3rd party bidder at sale.