Purchasing a friends foreclosed home

[Brandon Erlendson]

Hello,

We recently had a family friend lose their home to foreclosure. It comes out they didnt make the mortgage payment for the last 7 months and now they're out of the house. They have reached out to me and asked if I would be willing to place a bid on the home and buy it back from the bank for them. Where is gets a little sketchy is here.. they stated on paper I will have to state it will be my primary address/residence and I'm not buying it for them. This makes me wonder, is this a form of fraud or is this illegal? It seems like it could be as they are getting out of paying what they owe the bank and getting the house back at a cheaper price thus the bank is getting shorted. Any advice would be helpful! 

Thanks in advance. 

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Originally posted by @Brandon Erlendson:

Hello,

We recently had a family friend lose their home to foreclosure. It comes out they didnt make the mortgage payment for the last 7 months and now they're out of the house. They have reached out to me and asked if I would be willing to place a bid on the home and buy it back from the bank for them. Where is gets a little sketchy is here.. they stated on paper I will have to state it will be my primary address/residence and I'm not buying it for them. This makes me wonder, is this a form of fraud or is this illegal? It seems like it could be as they are getting out of paying what they owe the bank and getting the house back at a cheaper price thus the bank is getting shorted. Any advice would be helpful! 

Thanks in advance. 

 I think you and your friend totally misunderstand the foreclosure process. They haven't lost the house until the foreclosure sale occurs. Just because the bank set a sale date doesn't mean they've lost the property. They, as owners, still can sell the property up until the sale, it's perfectly legal. A sale can also be postponed if the bank allows it.

Why they think you'd have to say you are going to live there is beyond me. Anybody who bids on properties at sale, winds up owning the property and can do with it as they please. The bank is well aware of how much the amount is they are potentially losing. They choose to go to sale as a business decision. You don't need to feel sorry for a bank, I can assure you. They don't feel sorry for your or your friend. That is your pastor's job not the bank's.

You want to have your friend:

1. call the bank and ask when the sale date is to occur

2. and while talking to them ask how much the reinstatement amount is.

I need that information and the state the property is in to let you know the options.