Owner "wasn't aware" of Trustee Sale


#1

What would happen if we picked up a property (senior lien)?at Trustee Sale (in CA), and the owner who just got foreclosed on, claims they had no clue the Trustee Sale was taking place, and that they were in the middle of Loan Mod discussions with the foreclosing lender.
?
I did read a prior post of Sean’s that the Trustee Companies out there tend to document very well the proper notification processes they employ.
?
Could this “hypothetical” foreclosed on owner have a leg to stand on and possibly get the trustee sale “undone/rescinded?”, given that the trustee sale finalized already and new owner would only be days away from recording deed. I’d guess claiming ignorance is somewhat common from folks who get foreclosed on, looking to stay in the home. But I also know the various depts of lenders tend to not communicate very well with each other either (loan mod dept/loss mitigation/short sale dept/collections, etc). If the foreclosed on owner asked new owner for proof of the sale, what proof would you offer to show them the trustee sale did indeed happen?
?
Your thoughts/advice if this situation were to arise? Thank you!


#2

Happens all of the time in my business as an REO Listing Agent.? I request a copy of the sale date notice and then the recorded trustees sale deed.? I have found cases where one spouse keeps it from another, cases where the owner contacts the bank for a loan mod (most common) and think the sale has been cancelled but it hasnt.? The most common comment I get is there are in the loan mod process, it takes a few weeks of me showing them documenation for them to come around and then sometimes its too late to offer relocation.
?
Bruce


#3

Thanks Bruce - I completely agree, and would add that most owners don’t realize that if they enter a forbearance agreement or do a trial loan mod, the foreclosure isn’t cancelled and the lender will sell the property if they are late on a single payment after that. ? Usually I ask the owner questions like if they had ever received a notice in the past, if they had missed a payment recently, or if they have anything in writing from the bank showing that the lender had agreed to postpone or cancel the sale. My standard line essentially being that if the sale is invalid I’ll end up losing the house and I’d rather get my money back sooner than later - so I ask them to help me help them so we can get it resolved quickly. I did actually have one case where the owner had written confirmation of everything - had I not asked my money could have been tied up in a lawsuit for a while. Instead I contacted the trustee faxed them copies of the owners documentation and asked they send my funds back immediately. I had a check 2 days later.


#4

Have you ever seen it were a home is sold and the homeowners were in a workout with the lender and the bank sold the home at a sale and the homeowner did’nt know about it and thought they were getting approved for a loan mod. and have the payoff of the late payments to give and got the home back even if the investors hasnt gotten the deed yet.