if a house is sold at the sheriff sale can you purchase the property during the redemption period? assuming the homeowner is on board and is willing to sell you the house.
how would this be structure so that your risk is minimal?
You can buy his redemption right and redeem the property yourself. I had it happen to me when another investor redeemed a property I bought at sheriff sale.
jmd_forest
how is that handled? ie/ how do you formulate the contract? how is it handled at the sheriffs auction?
is it the same for all states with a redemption period?
Hello Jmd:
I saw your post on REI Club forum; in response to buying a property while in the redemption period. I was hoping you could elaborate on how to go about doing that.
I have a deal that’s currently in that similar situation. I negotiated a short sale on a property. I was prepared to close, when we discovered a lien on the property. I contacted the bank and requested an extension. It took some time to identify and locate the attorney as well as the creditor. Again, I contacted the bank with an update.
Nonetheless, long story short, they took the property to sale without any notice. I’ve taken the homeowner to the court house and file a motion to stay the sale or redemption period. At this point, I do not know what the property was sold for, in auction. I would appreciate it if you could steer me on how to possible purchase the property during the redemption period. I had an approval already for the short sale, that was good thru July 28th.
Thank you in advance.
Sorry I don’t have the details on HOW to do it. I know it is possible because I lost one I bought at sheriff sale when another investor redeemed it during the redemption period. I did a little research on it at the time and learned that the previous owner’s redemption right is a commodity that can be bought and sold. This was done after the sheriff sale was complete but before the end of the redemption period.
I would suggest seeing an EXPERT Real Estate Attorney to ensure you CYA if you want to try this.
One thing to remember, at least in NJ (other states may have different laws, rrules, & regulations) any second mortgages and other liens are wiped out at sheriff sale. If you redeem the property, any second mortgage and liens would still be attached to the property.
jmd_forest