Dodged a foreclosure bullet of surviving lien, can the deal work?

[Matt W.]

A little background: 

September 2019, while driving for dollars I noticed a run down house with papers on the windows, obviously headed to foreclosure. During my research and after hiring an attorney to do a title search we figure out that a $25k HELOC is causing the foreclosure, but an older mortgage of unknown balance would survive.

November, house sells at auction. Bidding started @ $12000 and finally sold at $80000. Needs lots of work, but ARV is @$200k. So many months go by and it never gets fixed up and ownership does not change on tax records. So today I contact the register of deeds and see that the winning bidder defaulted on their bid, lost their $6000 deposit, and the property is back for sale.

I contact the "trustee," a big law firm, and they won't tell me a straight answer about what they plan to do with the property or when they will do it.  I skip traced the winning bidder and he says he thinks the bank was coming after him for $50k additional money to get a clear title and satisfy the older surviving mortgage. 

Point being, is there any way to get the bank to sell straight to me in order to avoid going to auction again and potentially having another defaulting bid? The HELOC and phantom mortgage were both with Wachovia (now Wells Fargo), but of course they could have been bundled and sold as a MBS ten times by now. I know to some worker bee at the bank this property is just a column on a spread sheet, but it seems like it could be a win/win. Any advice is appreciated!

[Wayne Brooks]

The bank doesn’t own it, the borrower does, so the bank can’t sell it to you.  Track him down or wait for the next foreclosure auction.