Owner died ... wait for the foreclosure? (tenants, documents, 2013, appraisal)

[Aggiebuttercup]

This is something I've never dealt with before.

There is a house down the street from me that I would like to buy. The owner died last year. I contacted the address on the appraisal records - the owner's mother.

She said she handed the keys to the bank the week after her son died and that she doesn't own the house or have any say over it. The bank has paid the taxes, hired a company to mow the lawn, winterized the home, and hired the security company that checks on the house regularly.

She said she's gotten one foreclosure notice about the home recently.

We aren't clear who exactly owns the home.

I'm assuming that at this point we have to wait for the foreclosure to go all the way through be able to put an offer on the home?

[nybbler]

If the deed was transferred (deed in lieu of foreclosure), it should have been recorded; the bank will be the owner in that case and you can try to make an offer to them. If it's still owned by the estate it'll be messier.

[SmartMoney]

This could go on for years, if owner died without a will, longer.

[cully]

Mom may not be reliable.

If you're not sure you could ask the person who mows and the security company who is really paying them.

These days a lot of banks don't take good care of homes like this at all. And it seems it would have been put up for sale by now if the bank alone had responsibility for it.

Yes, search the tax info, title info more thoroughly. Many times, it's online.

[jackmichigan]

Of course, simply handing the keys over to the bank does not transfer ownership. There are a lot of possibilities here, so you'd really need to examine the recorded title records to get a better idea of what may be happening. If the mother actually owned the house with her son, say as joint tenants with rights of survivorship, she would legally own the house and could convey that interest to the bank. Or, if she inherited the property through a will, same thing (if the process has been completed). If there was no will, it's probably not resolved yet. If no one is in a position to grant a Deed to the bank, the bank will need to go through with a foreclosure.

I'd check the recorded title documents and go from there.

[dblackga]

I agree with jackmichigan -- there are a lot of scenarios that could be going on. You can check, or have an attorney (or paralegal) check for you to see how it currently stands, who is the owner of record. If it's the bank, if you come in with a reasonably decent offer, they will probably be willing to work with you -- God help you, though, if it's Bank of America or Wells Fargo, they might take WEEKS to figure out that they even own it. Best bet is if it's a small regional bank or savings & loan.

If it's owned by the mom, then don't wait until it goes into foreclosure. One, the more time the house stands empty, the more likely there will be structural or mechanical failures that cause harm to the hosue -- roof leaks, basement moisture, a sudden leak from an air conditioner, too much moisture in the house from no A/C, etc. -- houses need to be lived in. Two, it will be easier to deal with a person than it will be a bank.

[Aggiebuttercup]

I did a lot of digging in the county records. No joint tenancy

The deceased was not married and has no children. There has been nothing recorded that passes ownership to a member of his family. I can't find records of any probate case having been filed either, and I checked three different counties (where home is located, where the mom lives, and the one in the middle).

The bank named a sbustitute trustee (a law firm that handles many foreclosures in this area) in July 2013; it was noted in the assignment that the note was in default. It surprises me that it took a year to send the first foreclosure notice (according to the mother). State law says the second notice may be sent 20-30 days after that, and the second one would be filed with the county and have the auction date on it; that hasn't been filed yet.

If he died intestate (which seems likely), then his parents and siblings (if any) are joint owners of the home and can file an Affadavit of heirship to satisfy the title company and legally sell the home. I think the parents are divorced, and I don't think that the mother (who is acting as the estate's representative) understands enough about the process to be helpful.

So I guess I will check the county filings every month so I know when the foreclosure notice is filed there. I don't have the cash to purchase outright at the auction, but very few properties here sell at auction, so hopefully it will show up as REO within the next few months.

[cully]

What condition is the house in?

I'm thinking of a house lately that was in foreclosure but if it passed a buyer's look, it didn't pass inspections because of work needed for mildew and mold. No one, buyer nor bank , wanted to take that on so it sat . And sat. And sat. In heat of several long hot summers.

So now it's scheduled to be demolished. No word to any neighbors; even the nosey ones didn't get a whif of what was going on.

Does it seem like there was an issue with the house the bank didn't want to deal with?

[EngGirl]

Somebody is taking care of this house. In my area we have at least management company info on the window. But usually houses that are not on the market are noot for sale and best thing to do is just monitor it and wait.
A lot of things don't make any sense to me with houses like that. We have one down the street that was foreclosed 4(!) years ago! The bank is the owner and has local management company to look after this house. Bank pays monthly HOA (few hundred a month), someone came in and cleaned this house - and that's it. I guess banks are still overloaded these days and short on their hand to deal with all vacant homes...