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Experts say: Skip MLS and head to the auction

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Guest | 03 May 2012, 06:15 PM Agree 0

“More and more Canadians, and other investors looking for property in Arizona, Florida and Nevada, are going to the real estate auctions in order to find properties,”  Lance Livingston, with Smart Arizona Foreclosures, told CREW at last weekend’s Investor Forum Toronto.  “The auction is the last step in the process where technically the homeowner still owns the property and the bank is obligated to hold an auction and offer it to the public first before it takes title and puts it back into their inventory.”
Those auctions often take place once a month and see investors square off against each other but also a slew of prospective homebuyers looking to snatch up a deal. The investors, Canadian or otherwise, are no exception.
That represents something of a change from the usual way of Canadians acquire U.S. properties. Most have relied on bank REO listings on MLS or from their own inventory sales sheets of homes that have already cleared the auction process.
At auction, Canadians are finding highly motivated sellers, who generally have the full right to sell, unrestricted by pending foreclosure status.
That generally accrues to the buyer’s advantage, a slight edge Canadians facing increased competition for foreclosure properties are desperate for.
Still, buying at auction in some states comes without the checks and balances of purchasing an REO directly from the bank – if, in fact, you can find one.
-    “Buyer Beware” applies, and that buyer should have conducted a title search prior to bidding.
-    That buyer should also be aware that not all liens on the property may be extinguished through foreclosure.
"That's why Canadian investors really need to make sure they have a team in place locally that knows how to navigate the system locally," said Livington, a specialist in a market where property values have benefited from the appetite of Canuck investors -- Arizona.
  • John Edmunds | 08 Jan 2014, 05:53 PM Agree 0
    Buying at a foreclosure auction is very tempting but beware. In most cases you never get to see the inside of the home, it can be destroyed, have mold, code violations, Kitec plumbing?

    Then there are title issues, HOA's have super liens on any property that must be paid, it can amount to thousands. A "Trustee's Deed" what you get when you buy at auction, does not remove an HOA lien, order of bankruptcy, Fed Taxes due, or numerous other encumbrances.

    The home may not be able to be insured by a title company so how do you sell it?

    The main thing is talk to someone who has been in the trenches. My investors are quit happy buying through the MLS.
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