What Is A Judicial Sale?
A judicial sale is classified as a court-intervened sale of a mortgaged property in default. These sales are the result of unresolved disputes where the borrower is:
- Unable to continue with mortgage payments due to financial hardship
A mortgage carrier will determine that there is no resolution for the debt and equity remains in the home, according to an independent appraisal.
The goal is to submit proceeds from the judicial sale to satisfy the original mortgage. Likewise, if there is a second mortgage, some funds might take care of those as well. In some cases, if any monies remain after lien satisfactions, the borrower will be privy to those.
The Fundamentals Of A Judicial Sale
For people interested in buying investment property at a relatively reasonable price point, judicial sale listings can prove ideal. These sales work like a public auction, where the interested parties bid on a property for which the current owner cannot meet the agreed-upon payment terms.
The lender, in turn, remands possession of the home and attempts to sell it as a way to recover as much money towards the outstanding balance as possible.
Sales of this sort are typically local to the current homeowner and provided by the county. You can find them listed in your specific area by contacting the county sheriff’s office or the local courthouse.
Types Of Properties For Sale
A broad range of homes come under this classification, and all of them are foreclosures. You can find single-family dwellings, commercial structures, multifamily houses, complexes, units with multiple purposes. Anything is up for grabs.
You can see the list of what’s available in a couple of different ways. Each property will go in front of the sheriff’s office or the county courthouse, with some taking place on the courthouse steps. The police office has a website showing the upcoming sales. Also, if you prefer to, you can physically go in to obtain a hard copy. The local newspaper advertises the information nearly a month before the sale so you can prepare.
Preparation for The Auction
It’s wise to contact a knowledgeable attorney well before the sale, especially if this is your first time going through a process like this. A practice specializing in these services, such as Bartifay Law Offices, can advise you on the steps you need to take to prepare for the sale, such as the title searches for all the homes you have an interest in bidding on.
In some cases, you can search online, but sometimes it’s a requirement that the search take place at the primary courthouse. Most often, your designated attorney will handle this step for you.
It’s vital to find out if any state or federal liens are holding against the property, including taxes from the IRS or local taxes, including water fees. There could be judgments against other creditors towards the homeowner for which you could ultimately find yourself responsible if the court proceedings don’t secure them. Again, a legal practice can help you with this.
A Payment Requirement At Time Of Purchase
The amount you need upon purchase will depend on the total you’re planning to spend and the down payment required at the time of the sale. It can vary based on location, with some at 10 percent and others requiring 20 percent.
Be prepared so that you can pay with a money order, certified check, or cash. Personal checks are typically not accepted. At the time of the auction, you’ll need to have proof of funds for the percentage of the down payment that you plan to pay in full.
In most cases, you can find the rules and regulations for these sales at either the courthouse website or the sheriff’s office website.
A judicial sale is the ideal way to invest in real estate. However, you need to be specifically versed in the industry and have access to sensitive information to research properties.
It’s not a process you want to go into blind or alone. Using an adequate legal team as a backup will ensure your security with each purchase. Ultimately, each successful purchase will lead you closer to the real estate investment goals you have set for your future. It’s a team effort.
A team of professionals are lined up to help you at Bartifay Law Offices. Together they have helped individuals reach their investment goals for nearly three decades. They have the talent, skills, and impeccable resources to meet your needs. Reach out to Bartifay for assistance with your investment endeavors.