Foreclosure due to death

Hi Sean or Michelle, Thank you for your informative responses. I am interested in a property going up for trustee sale. The deed of trust I am bidding on is the first deed; there are no other liens. My concern is that the reason the property is foreclosing is due to the death of the owner. The vesting on the grant deed showed HIS NAME, A MARRIED MAN as HIS SOLE and SEPARATE PROPERTY. His wife had signed an interspousal transfer deed at the time of the deed of trust, as well relinquishing her rights to him. Are there any concerns in purchasing this property from a deceased owner of record? He has no equity in this property (i.e. he owes $380,000 but the property is worth at most $200,000). I also noticed that someone paid the first installment of the property taxes and I assume it is his family since it was paid in early November. Why would they want to pay the taxes in this case? The deed of trust does not have a due on death clause and he is the sole borrower on the deed of trust. Will I run into any problems later if I win the bid such as recission of the sale or probate from family ? Thank you so much. Quinn

Posted by Quinn
from CA




6 Answers

0
Another note to the above case: what if he has mortgage insurance?

Answered by Quinn


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Hi Quinn, We have not heard of a case where a probate court petitioned to have a sale rescinded. If the heirs of the estate were going to save the property they would do so prior to the trustee sale. Chances are they have made a decision to let the property go because it is over encumbered. A mortgage insurance policy would protect the lender not the homeowner and would not affect a bidder at trustee sale. Michelle
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And the taxes were almost certainly paid by the lender.

Answered by miket


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My landlord passed away in March. I am the renter and have been for 2 years....We had just agreed on a 5 year lease. I am on a 2 year lease due to expire in August. He was living in the Phillipines and was married. I heard about the death the day I paid rent in march. His father...here in the states, contacted me and told me the house was going back to the bank and would be foreclosed on. He told me in a letter ,,,good luck in the future, heres the account number at the bank...continue to pay your rent there and ask if i can stay till they foreclose.I wont get my deposit money back as i will have to go after his estate. Should i continue to pay rent or save my money for a deposit in the future.. How long should i wait for them to throw me out. Ive tried to call the bank but no one kows anything and they wont tell me anything because im not on the mortgage...Help!!!!

Answered by Lisa L. Clark


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My landlord passed away in March. I am the renter and have been for 2 years....We had just agreed on a 5 year lease. I am on a 2 year lease due to expire in August. He was living in the Phillipines and was married. I heard about the death the day I paid rent in march. His father...here in the states, contacted me and told me the house was going back to the bank and would be foreclosed on. He told me in a letter ,,,good luck in the future, heres the account number at the bank...continue to pay your rent there and ask if i can stay till they foreclose.I wont get my deposit money back as i will have to go after his estate. Should i continue to pay rent or save my money for a deposit in the future.. How long should i wait for them to throw me out. Ive tried to call the bank but no one kows anything and they wont tell me anything because im not on the mortgage...Help!!!!

Answered by Lisa L. Clark


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My landlord passed away in March. I am the renter and have been for 2 years....We had just agreed on a 5 year lease. I am on a 2 year lease due to expire in August. He was living in the Phillipines and was married. I heard about the death the day I paid rent in march. His father...here in the states, contacted me and told me the house was going back to the bank and would be foreclosed on. He told me in a letter ,,,good luck in the future, heres the account number at the bank...continue to pay your rent there and ask if i can stay till they foreclose.I wont get my deposit money back as i will have to go after his estate. Should i continue to pay rent or save my money for a deposit in the future.. How long should i wait for them to throw me out. Ive tried to call the bank but no one kows anything and they wont tell me anything because im not on the mortgage...Help!!!!

Answered by Lisa L. Clark


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My landlord passed away in March. I am the renter and have been for 2 years....We had just agreed on a 5 year lease. I am on a 2 year lease due to expire in August. He was living in the Phillipines and was married. I heard about the death the day I paid rent in march. His father...here in the states, contacted me and told me the house was going back to the bank and would be foreclosed on. He told me in a letter ,,,good luck in the future, heres the account number at the bank...continue to pay your rent there and ask if i can stay till they foreclose.I wont get my deposit money back as i will have to go after his estate. Should i continue to pay rent or save my money for a deposit in the future.. How long should i wait for them to throw me out. Ive tried to call the bank but no one kows anything and they wont tell me anything because im not on the mortgage...Help!!!!

Answered by Lisa L. Clark


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Hi Lisa, It could take several months for the bank to foreclose. There is no point in paying rent to anyone at this time. You can consider your deposit going toward your rent. Once the bank forecloses you are entitled to a 90 day notice or the bank must honor the terms of your fair market value of your valid lease agreement. Essentially you will just be waiting for the bank to foreclose and then you will be given time to locate a property and move or stay and pay rent to the bank under the terms of your lease. You would first want to find out if the property is currently in foreclosure and what stage of the process the property is in. A local Realtor should be able to help you. Michelle

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