Burned on foreclosure purchase

[Account Closed]

I was wondering if there is any investors who would be willing to share a horror story on a foreclosure they bought only to find they got more than they bargained for.

To get the ball rolling he is one of mine.

The story is about an unrecorded lien/  About 5 years ago in Susquehanna county, I was at a courtstep sale and there were about 10 bidders. The first of the 2 house started at $12,100. I thought it would sell for around 20k. Turns out I got it at the starting bid and was the only bidder. I was shocked. A couple of months later I found out why. It has a 13k sewer bill on the house which I had not seen at the prothonotary office. The bill had gone back to 1997 and was never recorded. I went to the sewer authority monthly meeting and ask for a reduction. They felt sorry for me and dropped it down to something like 7k. Now I always call the sewer and water companies.

[Chad U.]

@Account Closed   Here's one:

I once bought a property from auction where there were several unrecorded violations against it. Believe it or not, they were from the previous owner raising dogs in the house, and selling them all over the city. There were something like 15 fines which added up to over $28K, and the majority of these fines had absolutely NO relation to the property itself, and only to the previous owner who had been foreclosed upon. Since the City could not collect from this delinquent, the city decided to attach them to the property. However, they weren't recorded as liens on the property AND were not registered as violations through the normal code enforcement channel since they weren't enforceable against the property - they were from the Animal Services department. This for a new one for us!

These fines were not discovered until the day before us selling the property by our buyer's attorney, who ran a municipal search using the previous owner's name in addition to the property's address. Even though only 3 or so of the fines actually occurred at the property and the other 12 elsewhere, the City didn't care and wanted all of the fines paid even though the previous owner got most of the fines at other addresses.

Long story short, this delayed closing by a few months, $1000's in legal fees, and we only got the fines down to $11K. However, since she felt sorry for us, we now have a direct line into the lady at the department who can check any and all outstanding violations against properties. Moral of story, do as much research on any property prior to purchase as you can, especially municipal violations , or instruct your Title Co/attorney to do same. Had our buyer's attorney not discovered these, the property would have sold with all the fines attached since they did not affect title.