WHAT’S TOO GOOD TO BE TRUE JUST ISN’T
Buying Homes At Foreclosure Auction
By Jan Bergemann
Published September 25, 2012
old saying “What’s too good to be true just isn’t true” especially
fits for online foreclosure auctions on homes where the foreclosure was
officially caused by unpaid HOA/Condo dues. Don’t forget, that doesn’t
mean there is no mortgage foreclosure in the making, it just means that
the HOA/Condo was faster than the bank.
and more people complain that they are being misled by government websites
claiming that homes were auctioned off for “peanuts.” Even if there is
a disclaimer on the website saying that a buyer should do his/her own
research on the property, most potential buyers think they should take a
look at the property and check what shape the house is in. But since there
is no reference to possible mortgages or other financial demands not
covered by the auction price, potential buyers with no prior auction
experience buy the property at auction and pay the demanded auction price.
Then they are confronted with further outrageous money demands from
mortgage lenders and/or master associations that turn the “great
bargain” into really bad business, causing the loss of the money the
“new deeded owners” paid at auction. The next foreclosure is already
in the making.
foreclosure auctions are not good for inexperienced folks just trying to
buy a home and who just can’t withstand these tempting offers. These
auctions are even tricky for experienced investors, but regular folks like
you and I should keep our hands off these auctions. Buying a home at these
auctions may not only cause serious headaches, but makes you quickly lose
all the money paid at auction, when the bank (first mortgage holder)
quickly forecloses on this home.
forget, the original owners didn’t let the home go for just
a few thousand dollars they owed to the community association. There is a
lot more behind this foreclosure. Most likely the house is totally
underwater, meaning that the mortgage is much higher than the actual value
of the home.
me, even with the property values in
always remember: “What looks too good to be true most probably isn’t
read as well: