Re-Purchasing Property from Foreclosure Sale

[Roy Benson]

BP,

Yesterday I attended an auction in New Jersey and gave my card to a Real Estate investor (call him Rick) who was buying properties.  I'm not in the market yet but I'm exploring with my bro-in-law.  

Rick purchased a property for $158k  and after discussing said he was going to "sell it quickly for around $170k."  

Is this common?  How quickly can you purchase/repurchase properties, and why wouldn't a buyer just attend the auction and buy it for $158k?  

Also, if someone purchases this property, can a buyer then get a conventional loan on it?  

Appreciate any thoughts on this scenario. Could be rather common, for I am somewhat new to this and trying to learn.

I won't be buying anything for quite some time, but I have liquidity and my partner has GC skills, so we're looking.

Thanks,

Roy

[Ben Winchester]

If I'm understanding your question right..Once the first purchaser buys the foreclosed property, it's no longer a foreclosure. A foreclosure is the action of taking possession of a mortgaged property when the borrower doesn't pay. Once the foreclosed property is purchased, there is a new owner and borrower (the new owner could have purchased all cash as well, meaning there is no mortgage). Depending on how a foreclosed property is sold by the bank or by the person who was loaning the money, a new buyer could purchase the foreclosed property however they want (cash, loan, any other agreed upon method) I primary residence was a foreclosure. A bank loaned the money to the previous owners and the owners stopped paying, the bank took possession of the property and sold it at retail to me. I got traditional financing with 5% down. Once everything closed, I could technically sell the property the next day and it's not a foreclosure. My loan officer wouldn't really be happy because I did that so quickly, but that's a different story. As far as I'm aware, there are no laws on how quickly you can buy and re-sell a property. One thing to also know is that a lot of investors loan out their money to other investors. Depending on how the note is written, there usually will be leverage against the property in question, sometimes a different property that has value. But the point is, the investor who decided to loan money to someone could potentially foreclose on that leveraged property and become the owner. I guess I'm trying to say that not all foreclosures will be done by "banks" but instead they will be done by the person or entity loaning the money.