Property Obtained on Sheriff Sale Negotiating Mortgage Owed

[Dominic AIton]

Hi I purchased a property on sheriff sale back in January and the redemption period will be up in early July here! I have a property attorney and know now that I purchased an association lien and the mortgage will not be wiped upon me taking control of the property. I want to know if anyone has experienced negotiating these things and what I should expect to settle for in this market? I have 0 knowledge in this aspect and am welcome to any and all advice! Thinking of rehabbing renting, and refinancing to pull money out to pay the mortgage off and start getting some cash flow. On the other hand I could just sell pay off mortgage and 1031 to a multi unit. The expected rent is around 2500 with association dues will bring down to 2100 ish with a 287k mortgage owed puts the property at a pretty decent CAP rate or could sell and get about 100k profit ish and put in a 1031 after paying mortgage.

[Wayne Brooks]

Quote from @Dominic AIton:

No tax liens it was a 2nd mortgage at the sheriff sale I am under the impression by my attorney that I bought the HOA lien so unfortunately I think I still will owe the balance! Will try that strategy thanks for your input!

Actually, you Inherited the hoa lien, not “bought” it. The first mtg holder has no incentive to negotiate, being as there is equity.  On most loans, they Couldn’t negotiate since you are not the original borrower and they likely have mtg insurance/regulatory issues.

The hoa likely has little reason to negotiate also.