All Forum Posts by: Ralph Bednarczyk

Following up on this to my situation in Connecticut.  I am headed to a foreclosure auction (due to no mortgage payment).  I did title search, and indeed something came up.

The Bidding statement from the committee lawyer that will be running the auction says according to Tax Collector there is $2100 recent property tax owed.  So they have this property tax owed information, but not older tax liens, so I'm confused or uncertain.  

In title Report it's phrased this way:  

15. Tax Lien in favor of State of Connecticut Department of Revenue Services against (defendants) in the amount of $23,841.11 plus interest and costs dated August 2, 2023 and recorded August 10, 2023 
16. Tax Lien in favor of State of Connecticut Department of Revenue Services against ( defendants)  in the amount of $709.16 plus interest and costs dated October 25, 2023 and recorded November 2, 2023

They have 2 other judgment liens against them as part of the court filing, which is like 10k, which looks like they will be creditors and get that $ as part of the sale proceeds.  

I am pretty sure that whoever wins the auction at say 500k, will have to pay the Property tax liens owed on top of the 500, that it's not already baked into the reserve price.  Lawyer that arranged the title search for me believes so too but isnt 100%.  

Thanks for all thoughts!

@Mat O'Grady   Exactly, I got the documents and info off JUD.CT.Gov.  The Debt owed and the appraisal.  Do you recall how the starting numbers compared to the debt from the auctions you went to?

@Mat O'Grady     It's the trustee that is going to be there, not sure if they are appointed by court or representing the banks interest, I would think they are the Bank's representative, no?  

Out of your 5 auctions, do you recall how the opening price was relative to appraisal, assuming you got the market appraisal number beforehand?

also @Mat O'Grady there's an "inspection" taking place 2hrs before the auction, I'm guessing the bank representative lawyer just does a walk through.  From my research, these previous owners are deadbeats and the house on the inside is definitely below average with some real money like 50-70k worth to get it up to pristine level.  Neighbors have said lots of leaks, and who knows what they might do to trash the place on their way out.

If the bank has a set opening bid number the day before, but the walk through shows how suspect some things are, the bank representative cannot lower it, or accept lower if no one accepts opening bid offer? In that case, I guess it goes into REO?

Thank you @Mat O'Grady   

So I found out some more info-  The Appraisal is 500k, thus the 50k bid deposit.

The Foreclosed former owners debt plus court expenses is 405k!  Any guesses as far as where they would start the opening bid in that information?  Trying to get a sense of numbers and how to evaluate this property.

Would they start the bid at a little over 405k?  I have read somewhere about the 88% rule that banks seem to use as their minimum.  

Followup to this.  How is the starting bid chosen?  Can the winning bid end up lower than the starting bid?  Deposit is announced as 50,000 bank check needed on site.  Does that mean the bidding starts at 500k, and is it possible the property can be sold for say 450k?

The auction is on-site, and an inspection taking place 2 hrs before.  I sense that the house will be in a little below average shape, needing 50-70k to be pristine, would that change the auctioneers starting bid that day, since the auctioning lawyer probably hasnt seen the inside of the house himself? 

Also with the 50k, say I win, you have 30 days to close via a mortgage on the remaining balance it seems, so upon some reading it seems that I should have a mortgage pre-qualification letter already in my possession, or at least be deep into the process.  Is that correct?  

Thanks for any thoughts

Hi Suzanne, do you know when your next meetup might be?  Would like to attend the June/July one and want to get it on the calendar, thank you

Hey @Chow Ahmed , would love to hear an update.  I'm very interested in this area too, looking to do a deal inside of a year, maybe 6 months.  Anything pop out about these communities that changes the way you rank them or a difference-making factor?