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  • July 9, 2008 at 6:44 PM #13236
    jpinpb
    Participant

    When a bank sells a property on the steps, do they ever sell it for less than the loan amount on the steps, or when they get no offers for the loan amount, it automatically goes back to bank, to be seen listed for sale later for a lesser amount?

    July 9, 2008 at 9:41 PM #236449
    temeculaguy
    Participant

    I say no, there may be some exceptions but for almost all courthouse step auctions by banks (trustees), it is merely a legal step required to take the house back, it has to be offered for the amount of the debt. When the court is liquidating assets that are seized for another reason, there can be a highest bidder scenario but that would be stated in the public notice that you can find online from the newspaper website. The fine print will say something to the effect of the highest bidder as opposed to a specific dollar amount which in todays market is always more than the place is worth.

    The other drawback is that nobody has been inside at the point of a courthouse step auction, in some cases the occupant is still there and will need to be evicted. The bank doesn’t get to inspect until after the auction date, nor do you. It’s one thing buying an REO and entirely another buying an unseen property. Just ignore that stage. If it was worth the same or more than the auction amount, it would have already been sold by the FB who lived there. The auction amount is also only for the first, the second and other lienholders have not yet released, after the auction, they are wiped out and you can do a traditional escrow and have title insurance, not so with a step auction.

    July 9, 2008 at 9:41 PM #236645
    temeculaguy
    Participant

    I say no, there may be some exceptions but for almost all courthouse step auctions by banks (trustees), it is merely a legal step required to take the house back, it has to be offered for the amount of the debt. When the court is liquidating assets that are seized for another reason, there can be a highest bidder scenario but that would be stated in the public notice that you can find online from the newspaper website. The fine print will say something to the effect of the highest bidder as opposed to a specific dollar amount which in todays market is always more than the place is worth.

    The other drawback is that nobody has been inside at the point of a courthouse step auction, in some cases the occupant is still there and will need to be evicted. The bank doesn’t get to inspect until after the auction date, nor do you. It’s one thing buying an REO and entirely another buying an unseen property. Just ignore that stage. If it was worth the same or more than the auction amount, it would have already been sold by the FB who lived there. The auction amount is also only for the first, the second and other lienholders have not yet released, after the auction, they are wiped out and you can do a traditional escrow and have title insurance, not so with a step auction.

    July 9, 2008 at 9:41 PM #236632
    temeculaguy
    Participant

    I say no, there may be some exceptions but for almost all courthouse step auctions by banks (trustees), it is merely a legal step required to take the house back, it has to be offered for the amount of the debt. When the court is liquidating assets that are seized for another reason, there can be a highest bidder scenario but that would be stated in the public notice that you can find online from the newspaper website. The fine print will say something to the effect of the highest bidder as opposed to a specific dollar amount which in todays market is always more than the place is worth.

    The other drawback is that nobody has been inside at the point of a courthouse step auction, in some cases the occupant is still there and will need to be evicted. The bank doesn’t get to inspect until after the auction date, nor do you. It’s one thing buying an REO and entirely another buying an unseen property. Just ignore that stage. If it was worth the same or more than the auction amount, it would have already been sold by the FB who lived there. The auction amount is also only for the first, the second and other lienholders have not yet released, after the auction, they are wiped out and you can do a traditional escrow and have title insurance, not so with a step auction.

    July 9, 2008 at 9:41 PM #236588
    temeculaguy
    Participant

    I say no, there may be some exceptions but for almost all courthouse step auctions by banks (trustees), it is merely a legal step required to take the house back, it has to be offered for the amount of the debt. When the court is liquidating assets that are seized for another reason, there can be a highest bidder scenario but that would be stated in the public notice that you can find online from the newspaper website. The fine print will say something to the effect of the highest bidder as opposed to a specific dollar amount which in todays market is always more than the place is worth.

    The other drawback is that nobody has been inside at the point of a courthouse step auction, in some cases the occupant is still there and will need to be evicted. The bank doesn’t get to inspect until after the auction date, nor do you. It’s one thing buying an REO and entirely another buying an unseen property. Just ignore that stage. If it was worth the same or more than the auction amount, it would have already been sold by the FB who lived there. The auction amount is also only for the first, the second and other lienholders have not yet released, after the auction, they are wiped out and you can do a traditional escrow and have title insurance, not so with a step auction.

    July 9, 2008 at 9:41 PM #236578
    temeculaguy
    Participant

    I say no, there may be some exceptions but for almost all courthouse step auctions by banks (trustees), it is merely a legal step required to take the house back, it has to be offered for the amount of the debt. When the court is liquidating assets that are seized for another reason, there can be a highest bidder scenario but that would be stated in the public notice that you can find online from the newspaper website. The fine print will say something to the effect of the highest bidder as opposed to a specific dollar amount which in todays market is always more than the place is worth.

    The other drawback is that nobody has been inside at the point of a courthouse step auction, in some cases the occupant is still there and will need to be evicted. The bank doesn’t get to inspect until after the auction date, nor do you. It’s one thing buying an REO and entirely another buying an unseen property. Just ignore that stage. If it was worth the same or more than the auction amount, it would have already been sold by the FB who lived there. The auction amount is also only for the first, the second and other lienholders have not yet released, after the auction, they are wiped out and you can do a traditional escrow and have title insurance, not so with a step auction.

    July 9, 2008 at 10:08 PM #236607
    jpinpb
    Participant

    Thank you. I didn’t think they would sell it at the steps for less than the loan amount. Wanted to be sure. Seems like a silly technical process b/c they end up listing it for way less than the loan amount later on. So why not just sell it on the steps for less. But in any case, if they won’t sell it for less, then I’ll wait until it lists. Thanks again.

    July 9, 2008 at 10:08 PM #236617
    jpinpb
    Participant

    Thank you. I didn’t think they would sell it at the steps for less than the loan amount. Wanted to be sure. Seems like a silly technical process b/c they end up listing it for way less than the loan amount later on. So why not just sell it on the steps for less. But in any case, if they won’t sell it for less, then I’ll wait until it lists. Thanks again.

    July 9, 2008 at 10:08 PM #236479
    jpinpb
    Participant

    Thank you. I didn’t think they would sell it at the steps for less than the loan amount. Wanted to be sure. Seems like a silly technical process b/c they end up listing it for way less than the loan amount later on. So why not just sell it on the steps for less. But in any case, if they won’t sell it for less, then I’ll wait until it lists. Thanks again.

    July 9, 2008 at 10:08 PM #236661
    jpinpb
    Participant

    Thank you. I didn’t think they would sell it at the steps for less than the loan amount. Wanted to be sure. Seems like a silly technical process b/c they end up listing it for way less than the loan amount later on. So why not just sell it on the steps for less. But in any case, if they won’t sell it for less, then I’ll wait until it lists. Thanks again.

    July 9, 2008 at 10:08 PM #236675
    jpinpb
    Participant

    Thank you. I didn’t think they would sell it at the steps for less than the loan amount. Wanted to be sure. Seems like a silly technical process b/c they end up listing it for way less than the loan amount later on. So why not just sell it on the steps for less. But in any case, if they won’t sell it for less, then I’ll wait until it lists. Thanks again.

    July 10, 2008 at 6:32 AM #236579
    toddt
    Participant

    It certainly depends on the beneficiary and geography, but in general the stated opening bid on an auction notice (NTS in CA) is the unpaid balance including late fees, plus costs of foreclosure and any advances to priority liens.

    That said, I monitor much of the TS activity in San Diego and Orange County and I have seen a definite increase in trustee’s lowering the opening bid amount below this at the bene’s request. In some cases that’s translating into a rare sale to a third party at the courthouse steps.

    This is one of the key reasons why auction pros, when they’re active, do not ignore properties that might not make sense at the NTS amount.

    July 10, 2008 at 6:32 AM #236709
    toddt
    Participant

    It certainly depends on the beneficiary and geography, but in general the stated opening bid on an auction notice (NTS in CA) is the unpaid balance including late fees, plus costs of foreclosure and any advances to priority liens.

    That said, I monitor much of the TS activity in San Diego and Orange County and I have seen a definite increase in trustee’s lowering the opening bid amount below this at the bene’s request. In some cases that’s translating into a rare sale to a third party at the courthouse steps.

    This is one of the key reasons why auction pros, when they’re active, do not ignore properties that might not make sense at the NTS amount.

    July 10, 2008 at 6:32 AM #236717
    toddt
    Participant

    It certainly depends on the beneficiary and geography, but in general the stated opening bid on an auction notice (NTS in CA) is the unpaid balance including late fees, plus costs of foreclosure and any advances to priority liens.

    That said, I monitor much of the TS activity in San Diego and Orange County and I have seen a definite increase in trustee’s lowering the opening bid amount below this at the bene’s request. In some cases that’s translating into a rare sale to a third party at the courthouse steps.

    This is one of the key reasons why auction pros, when they’re active, do not ignore properties that might not make sense at the NTS amount.

    July 10, 2008 at 6:32 AM #236761
    toddt
    Participant

    It certainly depends on the beneficiary and geography, but in general the stated opening bid on an auction notice (NTS in CA) is the unpaid balance including late fees, plus costs of foreclosure and any advances to priority liens.

    That said, I monitor much of the TS activity in San Diego and Orange County and I have seen a definite increase in trustee’s lowering the opening bid amount below this at the bene’s request. In some cases that’s translating into a rare sale to a third party at the courthouse steps.

    This is one of the key reasons why auction pros, when they’re active, do not ignore properties that might not make sense at the NTS amount.

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