The Trustee Sale-And We Thought We Were Getting A Great Deal!
A key component when purchasing a property at a Trustee Sale (or any sale for that matter) is to research the chain of title. You can typically purchase a ‘”limited title report” for $80.00 to $110.00.
The purpose of this title report is to ensure several things. One, we want to confirm that the foreclosing lender is in first position and secondly are there any property tax, mechanic or IRS liens attached to the property.
When you purchase a home at the Trustee Sale, you are buying a lien, not a property. If you don’t do your research, you could accidentally buy a second position lien in which case you will have bought an obligation to pay off any first position lien.
IRS liens are rarer but more important. Per the IRS redemption rights, it states the property can be seized 120 days of notification of the Trustee Sale. Note the redemption period starts upon IRS being notified.
Another lien to consider is the mechanics lien. After verifying this type of lien, your next step will be finding the lien holder then try to negotiate a settlement. Contacting an attorney might be wise, otherwise consider passing on the home.
A home going to foreclosure almost always has State property tax liens. These liens usually don’t hurt the profit margin of the investor. They also do not need to be paid up front at the time of the Trustee sale. This type of lien usually has less cost factors than the other types of liens.
Trustee Sales in Arizona can help investors and homeowners gets great prices on homes in the Phoenix area but you need to do a little homework regarding the value of the property and the liens being purchased and acquired by the successful bidder.
By doing your research correctly and timely can reap amazing benefits to the investor. Arizona currently has some of the best bargains in the country for the savvy investor
See more information about az real estate by clicking the link: az real estate today.
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