Buying foreclosure

[Kristine Corneiller Stein]

We moved into a rental that our realtor arranged for us through a client who was in default with her mortgage. Our intentions were to be short term but instead we decided we loved the area and wanted to short sale, as offered. We are finding out that it is too late for short sale and house is in definate foreclosure. We are first time home buyers and are not well-versed in this area of knowledge yet but are scrambling to learn. Can anyone offer any advice, please?

[Joel Owens]

You living there you should have gotten some mail from the lender.The lender usually still believes the homeowner occupies the property so sends notices to the house you are staying at.

Kentucky appears to be a judicial (court) state with average time to foreclose 6 months.The property has to appraised before it can be foreclosed and sold.

Ways of knowing foreclosure has happened or not should have been provided

1.In the letters mailed out by the lender

2.The lis pendens (legal notice) filed at the court house.

3.Newspaper in the legal notice section.

The fact that I pulled this up in under a minute but your broker/agent doesn't know what is going on is scary.

If the agent has this listed as a short sale they should have an ATR (authorization to release) signed by the borrower giving them permission to talk to loss mitigation (the lender or servicer) about the file (loan).

How you work the short sale will depend on type of loans,junior loans and other liens attached and a whole bunch of other factors.The lender might want the property marketed for sale for so many days to see if higher offers come in that would net more than your offer although the lender might take into consideration you already live there.

Month to month you have no foreclosure protection tenant laws.If you had a long term lease in place the bank would have to honor the lease under certain conditions.