Fort Myers, FL · Member since 2016 · 1 post · 3 votes
10y
If I'm looking at a foreclosure that closed, and the winning bid was $198k. Final judgement was $493k and the plaintiff was a bank and their max bid was "hidden". After reading the previous posts, the bank would be out almost $300k that was owed to them and the third party bidder bought the house for $198k. Is this right? And if so, If I was the buyer, my concern would be other liens that may be on the property such as HOA, Federal, etc. How would I as a homebuyer protect myself against that?
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
13y
The plaintiff maximum bid is just that-it's how high they are going to bid. They tell you in advance sometimes so bidders won't run the bid up to $100k for no reason if they're going to bid $125K. The clerk of court charges 1.5% to high bidder, and 0.7% doc stamps, even if it's the bank. You have to open an account, and have your 5% deposit in the account prior to bidding. Full balance due within 24 hours, or end of the day, depending on the county. The money in your account can only be used for your deposit, not for purchase price. Not all counties are online. Some banks/plaintiff attorneys will bid up to judgemnt amount, some set a "market" take out number.
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
13y
Usually, the judgement is double what the property is worth. The bank sets a price near FMV that they are wiling to accept. Look at the online results and it will make sense. Bids usually "start" at $100, but if you're not willing to outbid the bank's number, it doesn't matter.
Residential Real Estate Agent · Miami, FL · Member since 2013 · 195 posts · 138 votes
13y
Quick question, as I've been reviewing the auction system for South Florida as well.
I've been looking at some past auctions, just to get a feel for things, and I keep seeing auctions that end with Sold To: 3rd Party Bidders. I take this to mean neither the homeowner or the plaintiff in the foreclosure action bought the property. Fine. But then I look and I keep seeing foreclosure actions by condo associations basically showing 15k to 30k in past due fees and/or assessments. There is no mention of the lender or mortgage holder in the documents. So I keep seeing auctions where the final bid is like 25k (presumably slightly more than the debt, hence higher than the Plaintiff's Max Bid).
Why are people buying these? Am I wrong in assuming these are junior debt positions (i.e., liens by the association) and that the winner bidder is still behind the bank/lender? I must be missing something because I've seen this happen several times and I dont believe that many people are throwing money away.
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
13y
Robert G. There are 2 types that bid on these.
1) Very few-but they are people who dont know what they're doing
2) The majority of bidders on HOA foreclosures are professionals, who know there is still a mortgage, but are banking on collecting more rent than they paid at the auction, before the mortgage holder finishes it's foreclosure.
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
13y
Wendell, I'm not sure how HB 87 is going to affect things. It gives the banks a much quicker avenue to get to final judgement on uncontested cases. But much of the current delays aren't road blocks in the system, but lack of timely follow through by the bank attorneys. Before the change, you could get to final judgement in less than 4 months if you timely pursued it. The same new reg.s apply to HOA's too, but their process was already quicker due to not having all the burdens of standing issues, possession of the note, etc. that banks have. Plus, the HOA's are local, they Need the money, and keep their attorneys on top of the process. So, nobody really knows yet.
Homeowner · Jacksonville, FL · Member since 2015 · 28 posts · 1 vote
11y
I know this is an old thread, but I'm looking at the same situation as the original poster...
@Wayne Brooks see if I get this straight... the auction I'm looking at has a final judgement amount of $4,000. The assessed value is $111,000 and the plantif-max-bid is $4,000. Does this mean, the home owner is willing to pay up to $4,000 and If I bid, would have to pay over $4,000 to win + assume responsibility of the loan until foreclosure is complete?
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
11y
@Lance KorsunYou are obviously looking at an HOA foreclosure, for that amount. The max bid is $4k because that's all the HOA is owed, and it's their max bid since they're the plaintiff. Any mortgage, or other liens, will stay with the property after auction. To determine a bid, you need to know All the other liens. I've seen bidders buy a property at HOA auction on Monday, then they lose it on Thursday to the mortgage foreclosure auction, because they didn't do their homework.
Stillwater, OK · Member since 2015 · 1 post · 0 votes
11y
In other words, the auction takes place in the first place because property owner owes money to however brought a litigation suit and by selling the property, the plaintiff attempts to recover his/her own money. Is that correct?
Let's work this as an example. If the property owner owes $100k to plaintiff, then the plaintiff sues the property owner/defendant for $100k. The property is assumed to have market value, let's say, $200k. The judge decides to auction owner's property for the plaintiff to recover his/her $100k.
In this scenario, is the final judgement $200k?
Is the plaintiff max bid $100k?
What is the expected bid for the property at the auction?
Sorry but it's a little confusing and Im trying to make sense of it.
In other words, the auction takes place in the first place because property owner owes money to however brought a litigation suit and by selling the property, the plaintiff attempts to recover his/her own money. Is that correct?
Let's work this as an example. If the property owner owes $100k to plaintiff, then the plaintiff sues the property owner/defendant for $100k. The property is assumed to have market value, let's say, $200k. The judge decides to auction owner's property for the plaintiff to recover his/her $100k.
In this scenario, is the final judgement $200k?
Is the plaintiff max bid $100k?
What is the expected bid for the property at the auction?
Sorry but it's a little confusing and Im trying to make sense of it.
The final judgement is the total amount owed to the plaintiff. That would include unpaid principal, interest, insurance, taxes, late fees, attorney's fees, court costs, etc. That $100k they owed could turn into $150k. The Plaintiff is entitled to their judgement amount and nothing more. If the above property example went to auction I imagine it would end up selling for more than the judgement amount in which case the plaintiff would be paid off in full and any additional amounts would be distributed to anyone else with an interest in the property. Any other judgements and liens would be paid off in order of priority and any remaining funds would go back to the previous owner.
These auctions are for more competitive than many people realize, especially in the larger counties. There aren't properties for pennies on the dollar and if you think you found one you probably are bidding on an HOA or 2nd mortgage judgement.
Flipper/Rehabber · Rochester Hills, MI · Member since 2014 · 6 posts · 0 votes
11y
I know this is an old post but today, on 4/2/15, can an investor actually get a deal on a Florida auction in Pinellas county? What are the tips for bidding? The do's and don'ts?
Should I have an attorney review the property data from website/lien records before bidding?
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
11y
The plaintiff's "maximum bid" is just that, simply how high they are willing to bid. If anyone beats that amount by $100, they get it. It may be the same, or lower, than the final judgment, it doesn't really matter.
Fort Myers, FL · Member since 2016 · 1 post · 3 votes
10y
If I'm looking at a foreclosure that closed, and the winning bid was $198k. Final judgement was $493k and the plaintiff was a bank and their max bid was "hidden". After reading the previous posts, the bank would be out almost $300k that was owed to them and the third party bidder bought the house for $198k. Is this right? And if so, If I was the buyer, my concern would be other liens that may be on the property such as HOA, Federal, etc. How would I as a homebuyer protect myself against that?
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
9y
You can order a title search from any number of sources....a local title co., local RE attorney, online services, etc. What you really have to watch out for, even with a search, are unrecorded hoa debts and unrecorded code violation liens. The code violations can be found for an extra fee, and 2 weeks of time. The hoa debts can be a wild guess though, unless a lien has been recorde, then you calculate additional fees, and add in a few thousand for attorney fees.