Found a Pre-Foreclosure/Probate Deal - not Sure What's Next?

5 Replies

Hello Biggerpockets. I need some help with a situation I've ran into. I've found a home here in Toledo, Ohio where the owner died and he did not leave a will, and the property has been sitting vacant for two years. I found this out by calling the son, who lives in another part of Ohio, and tells me that the mortgage is held through Fifth Third Bank who reached out to him 2 years ago but he hasn't heard anything since. I'm trying to figure out how I can go about finding the person at Fifth Third Bank who could help me out in purchasing this property before it goes for auction. Has anyone done this before? Last time I tried calling for a similar property I got nowhere. The son tells me the property will not go to him and that his father was underwater on it.

The lender wont talk to you about this. They don't own the property to sell it. You need to locate the owner of the property (likely the son), and they need to sell it to you. Furthermore this sounds like a short sale. Short sales require lots of documents and effort from the seller. If the seller has nothing to gain from the sale, they likely wont cooperate and you are wasting your time. Eventually the property will foreclose and you can then buy it as a REO.

What @Minna Reid said. Step away from the rabbit hole and work on something where an owner can sell the property direct to you or list it with you. If there was no will, it still goes to heirs based on the intestate laws of the state, but the heirs are also responsible for the mortgage then which is why they just ignore it. You can check the county's foreclosure auction block to see if it's listed yet and if not, there is a long way to go. No one at the bank will ever discuss that, they have hundreds upon thousands of these situations at all times.

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Easy just move into it and eventually it will become yours (adverse possession) 😆 

@Stephen Brown Seriously not worth chasing this deal; using basic software tools or even a trip to the records office can give you an idea of what the balance is. You'll most likely find a NOD with some figure of an amount. Furthermore, as already stated the bank will not talk too you. THE ONLY TWO WAYS to acquire this property is 1. the son must petition for probate and get the rights to sell you the house. Doing this when there is nothing in it for him plus a looming foreclosure and time restraints is probably not likely. 2. Adverse possession... depending on your state, you can take possession and pay the delinquent taxes (if they are in rears) for the next 5 years or whatever your state rule is and you keep the house. But again, if there is mortgage on this house, not a good idea since the bank may be paying those taxes and thus they are sheltering their collateral to sell at an auction. Bottom line, if its a vacant home and there's a bank involved ...its a no go for me.

@Stephen Brown only worth chasing if there’s a ton of equity in it. You can usually ballpark it based on the amount the loan was taken out for and how long ago it was. If there is plenty of equity then you’ll have to help the son through the probate process. This is a decent amount of work, but if you end up with a house at 30 cents on the dollar it can be worth it.