Due diligence for auction.com banked owned

[Jeff Macdonald]

Greetings! Question: do I need to research title for a "bank owned" auction.com online auction? What due diligence do people suggest for occupied homes? Thanks!

[Brian Burke]

Question 1:  It depends. Check the terms and conditions of that particular auction. If title insurance is offered, you'll have insurance against latent defects in title. You should also receive a preliminary title report that shows all liens and encumbrances and the terms of the auction and the purchase agreement should specify who is responsible for satisfying any liens.  If title insurance is not offered, then it's totally buyer beware and you have essentially the same risk as buying on the courthouse steps.

Question 2:  You don't have much opportunity to conduct more due diligence than can be accomplished from the curb.  Look carefully for clues as to how well the property has been maintained. Research the property tax assessment and be familiar with how that assessment is effected by a transfer.  And research the flood zone maps to see if the property is in a flood zone. Beyond that, it's all buyer beware.