OKC Sheriff Sale Rental Property in Receivership

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OKC Sheriff Sale Rental Property in Receivership

Leslie Boeshart
Investor · okc · Member since 2018 · 12 posts · 2 votes

What happens when a rental property going through foreclosure in OKC Sheriff Sale is assigned a receiver to intercept rents? As the winning bidder / new owner I have to honor the lease as per OKC. However few questions if the property is not under management:

- What happens to the tenant's deposit? As the new owner do I have to honor the lease with no deposit? Or does the tenant have to fund the deposit again?
- A receiver is assigned to intercept rents for the bank. Is the month of the auction a loss rent month as me the new owner? The winning bidder only receives a certificate of sale, and will not receive the Sheriff deeds until a confirmation hearing, which is at least 20 days out. Does this mean rent will be prorated on the day of the sale or based on the confirmation hearing?
- Can you get insurance on the property with just the certificate of sale? Or are you not the owner until the Sheriff deed?

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  • Rhett TullisBusiness Member
    Property Manager · Oklahoma City, OK · Member since 2013 · 1k+ posts · 617 votes
    6y

    while i am not an attorney this is based on my past experience with similar situations for other owners.

    -you would need to fund the deposit as the prior owner technically embezzled the deposit.  you can of course try to sue the old owner for it but i doubt you would get it. (again this is based on my prior experience in helping another owner it may differ somewhat)

    -i would assume it would be prorated for you based on the close date.  the issue is what would be considered the official close date the day you won the bid on or the date you take title.  

    -this one would be a good question for your insurance agent, i would think they could help here.

    [email protected]405-283-6522
    Integrity Oklahoma
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  • Leslie Boeshart
    OP
    Investor · okc · Member since 2018 · 12 posts · 2 votes
    6y

    Thanks Rhett! I figured the deposit the tenant would not be forced to redeposit. However, on move out are they still owed the credit and if they have a balance back is that something I have to fund? 

    I have a call out to the receiver today, hopefully they are able to answer some of the questions above. Will update the thread with what I find.

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  • Tracy StreichPro Member
    Real Estate Broker · Tulsa- OKC Oklahoma · Member since 2017 · 868 posts · 801 votes
    6y

    @Leslie Boeshart. I concur with Rhett. You will be in the hook for the deposit. As to ownership you do not own the house until

    Confirmation. I do not think you can insure the house until confirmation. In addition, you are not entitled to the rent until confirmation. A lot can happen in that 20 days!

    [email protected]918-728-8080
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  • Leslie Boeshart
    OP
    Investor · okc · Member since 2018 · 12 posts · 2 votes
    6y

    Thank you Tracy! Very true. I had a feeling confirmation is when you could insure since the winning bidder won't receive the sheriff deed until then.

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  • Leslie Boeshart
    OP
    Investor · okc · Member since 2018 · 12 posts · 2 votes
    6y

    **Update** I take possession of the property 3/6 at the confirmation hearing. You don't own a property at the sheriff sale until the confirmation hearing nor the rents. Finally getting the cash flow starting 3/6! 

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