Trustee Sale Insanity

[Account Closed]

Recently, I held a $35k 2nd against a house in East Palo Alto CA that had a $230k (+ over $20k arrears) 1st. I estimated the house to be worth somewhere in the low $300k's, Zillow has it today at $373k, eappraisal at $303k (these estimates were a lot less when the default started a year or two ago). I let the 1st foreclose thinking there wasn't enough equity for me to do it and I would just write it off.

Guess what. Somebody bought it at trustee sale for $511k!! ... unbelievable. I got my share of the overbid (principal + a few years interest) and I'm sure the owner got the balance of the overbid...I'll bet he was surprised, as was I.

Are these trustee sale buyers drunk, or what.

Palo Alto is an expensive neighborhood. This particular house was on the fringe of Palo Alto, drug deals going on etc. I think the trustee sale buyer just didn't do his homework.