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I bid on a foreclosed home in CO, then a second mortgage was found, now what?

Elizabeth asked:


Me and my husband just put a bid on a home in colorado, then the day before closing, the title company ‘found’ a second mortgage. Now we are waiting for them to settle it? In the mean time we are staying in a hotel, because are lease expired and are looking into renting again. How long is this going to take, and how did the seller not know about a second before it went to auction?

Brandon

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This entry was posted on Thursday, July 23rd, 2009 at 11:49 pm and is filed under Mortgage. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

6 Responses to “I bid on a foreclosed home in CO, then a second mortgage was found, now what?”

  1. mccleary97502 Says:
    July 26th, 2009 at 7:49 am

    Linda

    Be glad it was found before you signed the papers. If it was found after the papers were signed, you would be handling it, not the escrow company.

  2. chatsplas Says:
    July 27th, 2009 at 9:00 pm

    Raul

    That’s a problem with buying foreclosed homes, delays and more delays. Foreclosure should have wiped out lien of second mortgage on home, and if it didn’t they have to do so.
    TALK to your attorney, to lender, to title company. Let them know you’re homeless.
    We have no idea.

  3. Kile Says:
    July 28th, 2009 at 5:59 pm

    Melinda

    It could tae a few days or a few months no one know the answer just depends on how fast or slow they respond to the problem and fix it.

    Let us guess you do NOT have an Atty or agent and tried this potentially very risky and potentially complicated process on your own.

  4. src50 Says:
    July 31st, 2009 at 10:40 pm

    Kurt

    Do you mean a bank-owned home? If so, the bank probably foreclosed due to default on the first mortgage and may not have known about the second. That’s what the title search is for.

  5. Real Estate Guy Says:
    August 1st, 2009 at 1:06 pm

    Aaron

    plan to wait a LONG time. 2nd mortgage holders usually take a long time (or never) to reply to an offer that will totally wipe their debt off the books.

    I would recommend you make an offer that pays the 2nd holder someone.

  6. boilerette72 Says:
    August 3rd, 2009 at 5:12 am

    Agnes

    Actually, it’s not necessarily a good thing that this happened before closing. if it happened after closing, and you had title insurance (which you WILL get with a Foreclosure) then you can claim that on the insurance and you wouldn’t have to deal with it.

    Yeah, you’re going to have to wait for a bank to take care of the second mortgage. it could take a while.

    BTW, if closing doesn’t happen when the contract says it will you can cancel the contract.

    You should talk to your real estate agent/attorney, etc… not us crazy folks on YA.

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