Hello, and thank you for your help ahead of time.
I am bidding on a house that is listed on HUBZU.. It is bank owned. I just did a flip 6 houses away from this house and did extremely well. I have purchased many house for rental purposes or for flips in the past, but I never bid on a house that is bank owned, but STILL has occupants. It said on the listing not to disturb occupants and it is up to the buyer to get them out.
My question is...why hasn't the bank got rid of them? It went to sheriff sale. I have bought 6 house that were bank owned in the past, but like I said, they were vacant.
How difficult is it to get them out? Why are they still there, and why didn't the sheriff remove them?
Hate to lose the deal, or worse I am high bidder and get it only to be stuck with them. Any input would be great.
It's common with REO's on Auction.com. The sheriff doesn't automatically evict tenants unless the owner does an eviction.
Okay, that being said, is is similar to a simple eviction process as you would use to remove a tenant from a rental property or is it a lot more involved. From doing the research these people have lived here since 2006. I have heard of offering cash for keys type situations but I would think it is easier said than done. My concern is doing a cash deal, tying up 100K+ (which I do often) but I also get in and out. I am not happy with tying up the money and not having a plan where for all I know they could stay for a year. Any more input? I tried asking a lawyer friend of mine but all they want is "$10,000" to start. Typical response and they have no answers.
Regardless of what auction.com says on their site, knock on the door, talk to the tenants, and see what their plans are, and get a feel for how they'll be to deal with.
Depending on your state laws, it could depend on if the "tenants" have a lease. If there is a lease, you may need to honor the contract until it expires. But, I bet there is not lease there so once you own the home, the eviction process should be standardized. Check to see what is the process in your state and how long it will take.
Typically the renters know that the property in under foreclosure and they realize that eventually they will be evicted. Often lenders leave tenants there to maintain the property and enjoy the incoming rental payments before it sells.
@Chris Da There is no way to know for sure why the REO owner hasn't evicted the occupant. It is possible that an eviction is in progress, and it might even be complete by the time escrow closes. Or they might just abandon the eviction and dismiss the case. Or there might be no pending eviction at all. I've experienced all three firsthand.
If there is no eviction, it might be because there is a tenant in place with a fixed-term lease that must be honored until the expiration. Or it just might be that the seller doesn't want to hassle with an eviction, they'd rather let you go through the hassle.
I've found that occupants remaining after an online auction tend to be more difficult to deal with than those remaining after the courthouse auction. By the time a property is sold at an online auction, those occupants have likely been living for free for years, and even the courthouse auction didn't scare them off. Neither did the REO agent that showed up after the auction. They are waiting for the very last minute, and they'll file every motion under the sun to drag out your eviction. I'm not saying this always happens, but it does seem to happen at a higher rate than I've noticed at other acquisition venues.
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