All Forum Posts by: Spencer Hoyt

Let me clarify without going into an essay. First I deal with small community banks whith whom I have formed a relationship with a local banker. Second, The bank will always bid up to the amount for the mortgage balance. Third, if the bank is having a difficult time selling the forclosed property they will work with an investor to get the asset off of their books.

Originally posted by @Ron S.:

Originally posted by @Spencer Hoyt:

In my experience, a foreclosure auction does not sell for less than what the mortgage balance is. I find the best deals by working with the banks directly vs the auction. The banks want a bad property off of their books and it is easiest to work with them directly.

@Spender Hoyt - You must be working with a single branch mom and pop bank because no reputable bank in the country would work directly with you. Until there is an auction (foreclosure sale), the bank doesn't own it so exactly how are you working with the banks directly? Maybe I'm misunderstanding what you wrote or, maybe you misstated but you did say "Off their books" which would imply they own it, which would imply they went through foreclosure sale and if that did happen, still, no reputable bank would work directly with a buyer. They have a duty to their shareholders/members to maximize recovery and minimize loss and not exposing the property (REO) to the open market would be negligent in my experience.

Maybe you mean working with the owners through their agent or, maybe you mean working with the bank through their agent after the foreclosure. In either case, if you are working with an agent, you are working with an MLS listed property. if you aren't I go back to my first sentence. No reputable bank would work directly through you.

To the original post....you don't find that out. Unless the current owner pulls out statements showing their balance to you and/or unless the trustee has published the bid amount (Which is usually the total debt owed or a formula of the total debt owed), you won't know what's owed. It's not public information. That said, a foreclosing entity will not foreclose for more than what is owed. THEY will only bid what is owed to them. If third party bidders (The public) drive up the bid price above total debt, overages go to other lienholders in line and if there are none, go back to the original owner. If there are no bidders after the trustee/auctioneer announces the opening bid, it goes back to the beneficiary (The lender) as an REO property.