Profile picture for user02071702

Sheriff's Sale

I am looking at a property that is scheduled for Sheriff's Sale next week. The county website states that the home is assessed at $127,880 and the amount owed to lender is $50,000 more than the assessed value. I called the Sheriff's office to inquire about opening bid amount (to see if I should even bother considering the property) and the officer stated that the opening bid was below $10,000! This sounds basically crazy to me. I am interested in purchasing the home to live in, not flip or resale. I would like to get a deal on a house but realistically understand that the house won't sell at the opening bid price I was given. Any insight on sheriff's sales or why this opening bid would be set so low would be greatly appreciated! 
  • November 14 2013 - Albion
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Answers (7)

Profile picture for user7143485
There are a lot of things to understand in a Sherrifs sale.  The auction price usually does not reflect any subsequent liens on the property that you will become responsible for after you buy it from the financial institution that holds the mortgage.  You also will be responsible for payment of last years taxes as taxes are paid in arrears.  If you don't know the process, I would advise that you do a lot more research before treading into this "buyer beware" market.
  • November 27 2013
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Profile picture for user02071702
Thanks all for responses. In our county I learned the opening bid is set by the amount the court will collect during sale. Of course the bank would never let the property sell for that amount nor did I expect them to do so. I did call the lawyer who was representing the lender and they were very helpful and informative on how they handle foreclosure proceedings. They stated that there is a set amount in which they are approved to bid up to and even 1 cent over that amount they can not counter bid above. In this instance they were able to provide us with the amount they would bid up to which happened to be above what we felt was even fair market value. In our case, we didn't expect to get a steal of a deal and were willing to pay what we felt was a "reasonable" offer. At this point we will wait until it is listed with a realtor and see what happens from there. We had hoped to simply bypass the waiting period between bank repo and listing with a realtor which usually takes several months in our area. In closing we were aware and prepared to prove available funds.
  • November 27 2013
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Sheriff sales occur for several reasons (mortgage forclosures, tax issues, etc) and opening bid figures can be determined by the balance owed.  Based on the info you provided it sounds like this sale may not be based on lender balance.  When price seems to good to be true, it usually is, and the lender will jump in and either postpone the sale or buy it themselves (sometimes before the auction takes place).  If you are planning on attending be sure you know all of the terms (the deposit %, payment schedules, proof of funds, and form of payment) required.  You want all of that info before being named successful bidder.
  • November 26 2013
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Profile picture for wetdawgs
So, how did it go?   
  • November 26 2013
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At auctions they typically set the price low to attract buyers, then competitions drives the price to a premium.
  • November 26 2013
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Profile picture for CallTheSisters
Like any auction it starts low and finishes high. Where it opens or starts has no bearing on where it ends up.
  • November 26 2013
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Profile picture for Rebecca Marvel
Be prepared.  Have CASH in hand and an absolute top dollar you'll pay.  You will have an incredible amount of competition on the court house steps and I would say you probably won't get the house because there will be people who will pay more than what it's worth (to you).
  • November 14 2013
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