I’m real estate investor in the Illinois. I pride myself in locating homeowners ( often times when the courts cannot) in pre-foreclosure and negotiating the successful deal before the foreclosure auction of sheriff sale, as it referred to her in the Chicago land area.
It’s no surprise that often time the pre-foreclosure negotiations prove unsuccessful – I offered my client the conservative $5,000 to $15,000 as I would have been purchasing the property with seeing the interior and rehab was already needed based on the exterior (As unpredictable as auctions are I had no clue that the bidding would go as high as it did – $33,000 over the judgment amount). In my opinion, these negotiations failed because the homeowner was up in their years (74), living in a senior citizens hone and not quite there mentally, schizophrenia – perhaps even affected with Alzheimer’s. I could not find any family members or anyone else with power of attorney that I could work with – this lady it the only principal.
That being said, the sheriff sale proceeded as scheduled – I participated in a very heavy bidding session that ended up being awarded the another investor as the highest bidder – the property had too many unknowns for me to go over my bid ceiling.
Here’s the million dollar questions (2).
- In Illinois the (prior) homeowner is entitled to surplus proceeds or surplus funds after all interested parties have been paid off. In this particular case a pretty hefty $33,000. Here’s the kicker – the auctioneer and the courts do not know where this (prior) homeowner is located and could not successfully serve her – which means they cannot successfully notify her of the $33,000 in funds due to her. Can I, as an investor, with obvious investor interest (finder’s fee for notifying the (prior) homeowner about these funds) somehow orchestrate a successful “referral” without getting shafted. Once I peak her interest, she could probably easily run down to the courthouse and successfully inquire into and gain her funds. But again – now – she has NO CLUE. I mean, morally if someone knocked on my door an told me I have $33,000 that I did not know about – I’d be more than happy to give them some – even $8,000 – especially since I have no clue of this at all.
But as we know, we cannot survive in our business on the (prior) homeowner being moral. Can I somehow contract a legal agreement that will insure I get a finders fee – even if I have to resolve to a little as $1,000. Would such an agreement or contract allow me to successfully litigate if she just runs and grabs all of the money. Has anyone ever encountered this before? Of course my last option would be to play good Samaritan, tell her about the money – move on & like the guys we read about all the time that find thousands of dollars – turns it in without blinking and if they get a reward fine – it not; at least “We’ve done a good deed”.
- How many other people out there have sheriff sale surplus funds due to them that go unclaimed? After I talked to the auctioneer (the company that conducted the sale here( – the answer is “plenty’. In this case (as well as countless other auctions that he’s conducted), he signed the unclaimed check over the Clerk of the Court – because he had no response from the (prior) homeowner. The courts now have these funds and if they remain unclaimed over a timeframe (unknown), the funds go back to “the good of the people of the State of Illinois”. Are there any websites, books or e-books that target this type of investment strategy – or would it all be reliant on the morality of the (prior) homeowner to give us a finders fee out of the goodness of their heart?