Some newbie questions

[Robert Norman]

So I'm looking at a house up for constable auctions next week. The HOA foreclosed on it and similar ones have been picked up for about $1,000 - $1,500.

Here are my questions:
How can I determine the balance owed to the mortgage company?

The house was literally abandoned, then burglarized and vandalized. There are holes in the sheetrock and ceiling, some doors have been broken, the AC condensor, blower motor, and breaker box all stripped bare so obviously I don't want to jump in with a significant balance outstanding on the house.

What I have been able to determine: the previous owner had been there 15 years and I'm guessing I will owe most or all of the 2011 taxes (about $2.5 K)

My rehab estimates are around $12K, taxable value is at 70K (with homestead exepmtion), recent flips (same nighborhood) have sold for 80-90K. The house is in a great spot, and could be a nice rental or flip sale.

I'd like to pick the brains here to find out: the pitfalls of picking up an auction house, am I in over my head (never done a rehab), how do I determine all of the finacial liabilities of the property prior to bidding?

Thanks in advance! I'd love to get my first SFH rental rolling and get some skin in the game -- I just don't want it to be my rear!!

[Jon Holdman]

The documents recorded for the foreclosure will tell you which lien is foreclosing. The lis pendens, notice of default or whatever its called in your area. A title search will tell you exactly what's outstanding on the property. The title search should include the foreclosing lien and would show the order of the liens. Prices for the search and subsequent title insurance will vary, so call around. May cost you a few hundred, but can be credited toward the title insurance if you eventually use the same company.

Be sure you understand the HOA situation. If they have lots of foreclosures you may be getting some big bills from the HOA to deal with their expenses and to build reserves.