TS Opening Bid

[Jake Kucheck]

I touched on this property with a thread about a month ago, so feel free to revisit that here:

http://www.biggerpockets.com/forums/103/topics/58157-postponed-no-reason-

Now I have a new question. My understanding of opening bids is that they are roughly an amalgamation of the lien amount owed to the foreclosing entity, legal fees, HOA fees, etc but somehow a number is derived.

In my world where things make too much sense, it would seem that if you were to present the servicing entity with a cash offer for that amount, they would accept it (since this is what would happen at the TS auction).

My question is this: Why not?

How come you have to sit through weeks, months and years of postponements to wait for the one day the servicing entity finally decides to actually sell the property? Shouldn't an offer meeting their criteria be accepted? Or at the very least, shouldn't their be a platform for submitting such an offer? If my client wanted to vastly overpay for the property, making the investor holding the First TD whole and then some, surely they would find a way to accept THAT offer... so why not ANY offer?

Any answers here would be greatly appreciated.

[Justin S.]

The homeowners still owns the home up until the trustee sale, the servicing company and the bank have no legal right to give you the deed prior to that sale date. You could offer to buy the note prior to that and then foreclose yourself, but banks will likely get more money at auction or as an REO since there will be competition. You would have to approach the homeowner about buying the house prior to that and request a loan payoff request from the bank.