What Happens After Delayed Foreclosure Auction?
Foreclosure auctions can be delayed for a variety of reasons. The homeowner may have filed a last minute appeal with the courts, or could have produced the deficiency amount to stop the foreclosure. Additionally, the lender may have found a borrower who is willing to pay an acceptable price for the property prior to the auction, or may not have completed all of the steps to legally complete the foreclosure auction. Because of the wide variety of possible scenarios, it's important for real estate investors and buyers alike to be aware of delays and the reasons behind them so that they can make educated decisions on how to proceed with a property purchase after a delay.
Other People Are Reading
-
Reason for a Delay
-
If the reason behind the delay in foreclosure has to do with a homeowner filing a last minute order to stop or stay a foreclosure, several things can occur after the delay of the foreclosure auction. Proceedings for a temporary restraining order against a lender or a stay of foreclosure due to bankruptcy can delay a foreclosure auction for several months, and, in some cases, stop the foreclosure proceedings completely. These filings are a matter of public record, thus an interested buyer can follow the progress of the property through legal channels to review purchase options if they exist.
Bank Failures
-
In the event that the lender causes the delay of the foreclosure auction due to not having all paperwork completed or filed with the courts, the delay is normally not a long one. The foreclosure auction will typically be delayed until the next public foreclosure date, which is normally one month after the original date was set. As with all matters pertaining to foreclosure, the new auction date will be advertised and becomes a matter of public record through the courts.
-
Real Estate Owned Properties
-
Many properties that are delayed in the foreclosure auction process will be converted to real estate owned (REO) properties. These are properties that were not successfully sold at auction and are subsequently placed on the open market by the lender for sale. Once a foreclosure auction delay has occurred, the lender has the option of converting the property into an REO, which is advertised to buyers and investors on major websites such as Realtor.com and on the local multiple listing service. At this point the property can be purchased by an interested buyer without any encumbrance from the courts.
-
