Bought a occupied condo in auction

[Sateesh B.]

Bought an occupied condo in auction this week, I am a rookie into investment real estate, I have never dealt with dealing with properties that already has owner living in it. Can any one suggest what are the things i got to do to vacate the owner and also make sure that he doesnt do any damage to the property.

The condo that bought also has a clause saying owners have to live in the condo for 2 years before renting, is this applicable for me, since i bought this in auction (i didnt knew this clause and was not mentioned on the auction that there is a rental clause) would i be exception for this clause.

Appreciate your replies. Thanks

[Deanna McCormick]

Download your state landlord tenant laws.. So you know what's up.

Download your HOA owners laws.. and figure that out.

Get a copy of the tenants lease,, if they have one if not,, then I would venture to say they are month to month tenants if they can not produce a current lease document.

Good luck,, sounds like a murder mystery.. :)

[Jon Holdman]

First, figure out what you really bought. Specifically, there may be senior liens or encumbrances on this property that are now your responsibility. Its not uncommon for a second mortgage to foreclose, you buy the property based on that second mortgage foreclosure and discover a big first mortgage that is still in force. Even worse, HOAs can foreclose for unpaid HOA dues. What can seem like a great deal can actually turn out to be nothing at all.

Second, figure out what the process is to get title to the property.  This varies widely from state to state.  Here in CO, its pretty quick - a couple of weeks.  Other states have much, much longer timelines.

Its very possible the occupant is the previous owner.  One way to get them out is to offer them "cash for keys".  That is, a cash payment if they vacate peacefully with no damage.  Paid ONLY after they are out.  If they refuse, you will have to evict.  And you will need to get title first.

You don't have to live in it. But it you don't, the HOA may be able to block you from renting it.

When buying at a foreclosure auction, you MUST do careful due diligence on your own. This isn't like a normal purchase where disclosure are part of the deal. Its your responsibility to research the property and find out about any HOA restrictions and other liens.

[David Weintraub]

Where is the condo located?  Monroe, NJ?  My folks live there, so I am there almost every other weekend.

As the poster mentioned above, make sure you bought a first mortgage.  

[Sateesh B.]

The property is in east Brunswick not in Monroe.
looked into the county records for the last 15 years, Looks like the condo was earlier a co op that was converted into a condominium association, I don't see any liens pending expect the mortgage, The auction site lists the same mortgage company name as the owners, The mortgage company did foreclose the property on Aug 2016, the condominium association attached lien on July this year, and there is also a discharge recorded with the county for the condominium association (dollar amounts match on both the county document).

for a peace of mind thinking of running a title search, any ideas where I can get a title search for a small fee. thanks for your replies.

[Jon Holdman]

Around here it would be a title company. In NJ it may be an attorney. Sounds like you did buy an HOA lien because the current owner (the former lender) failed to pay the HOA dues. Seems odd, though, that the former owner would be living there if the foreclosure was last here. Is the occupant a tenant put in place by the new owner? I think you need advice from an attorney.

[Wayne Brooks]

Yes, the rental restriction absolutely applies to you, no matter how you acquired it. The condo covenants are a recorded document and run with title. Many here have condos or houses in HOA's as investment properties at auction and not realized there was a rental restriction because they didn't research the covenants beforehand.