The general rule for lenders bidding on property being sold at a sheriff's sale is that the foreclosing lender should bid up to an amount equal to the lesser of (1) the fair market value of the property (determined by a recent appraisal) or (2) the sum of (a) the amount of the lien in question plus (b) all prior liens to be divested by the sale plus (c) costs.
It is important for a lender to distinguish between the issue of whether a particular lien is divested at a sheriff's sale, as opposed to whether a particular lien is a superior lien for purposes of distribution of proceeds from the sale.
Lenders should not forget the possibility that the transfer of title for the mortgaged property pursuant to a sheriff's sale may be subject to transfer tax.
When a bank purchases a home at sheriff's sale, the property becomes "real estate owned" (REO) on the bank's books.
Figure 2 shows the percentage of twines that have a second sale recorded after the sheriff's sale.
Sheriff's sales that occurred within the year prior to the Order are addressed by requirements that the deeds and distributions be handled within six months of the Order (or of the date of settlement, whichever is later).
25 /PRNewswire/ -- Nearly a year after the Pennsylvania Land Title Association (PLTA) filed suit against the Philadelphia Sheriff's office and the City of Philadelphia, the parties have agreed to a settlement that protects lenders and insurers by improving the accuracy and accessibility of information and by insuring timely distribution of Sheriff's sale proceeds.
If a home is found to be uninhabitable and beyond repair after the sheriff's sale
, the lender has foregone any proceeds from another bidder.