I purchased a foreclosed home in Alabama in October ...

Submitted by jimclark4 from AL - 02/06/2009 - 8:28pm

I purchased a foreclosed home in Alabama in October 2008. The purchase price was 75,000 from the bank. The apprasial value is 140,000. Is there a certain length of time I have to wait in order to sell this property?

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Comments

Submitted by Sean - 02/07/2009 - 12:27am

Congratulations Jim. Do you have possession of the house at this time, or is it still in the redemption period where the prior owner can redeem the loan?
 
So long as the redemption period has passed, you should have no trouble selling the property. The one thing you may have to deal with is that banks can be tough on approving loans on appraisals where the prior sales price was considerably lower than the current appraised value. You can usually work through this by documenting that you made improvements, had to evict owners, took care of deferred maintenance, took the risk of buying without title insurance, etc. Bottom line is that the lender needs something in their file to explain the discrepancy.

Submitted by jimclark4 - 02/07/2009 - 8:32am

Redemption period is over in June, but I have a buyer that wants it now.  The prior owner owe $165000 on the house they are not going to come back and claim it when the appraised value is $140000.

Submitted by Sean - 02/08/2009 - 10:42pm

Perfect. Just give the prior owner a few bucks to give you a "quit claim" deed giving any rights they have in the property to you. I've done this before in CA for HOA foreclosures (only HOA foreclosures have a redemption period in CA). Check it through with a title company or real estate attorney before proceeding, but I'd be very surprised it it doesn't work.

Submitted by ann - 03/29/2009 - 6:45pm

i just losy my house in foreclosed, iam in alabama the redemption is 365 days can i reclaim my hoouse if i can pay it off

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