“Buyer Beware” is the rule at tax auctions. Post 136

Auction of foreclosure properties draws 200

The Wichita Eagle Kansas, MO

…at the Sheriff’s tax foreclosure sale at the Sedgwick County Extension Education Center. The Sheriff’s office auctioned 75 properties .

• Gallery: Sedgwick County’s tax foreclosure auction
•
To the 200 people who showed up Monday to bid on Sedgwick County property in tax foreclosure, Chris McElgunn voiced a warning.

“It’s buyer beware,”McElgunn told potential bidders.

They came to … bid on about 76 parcels: some vacant lots, some with buildings or homes, much of them “distressed.” The property goes to the highest bidder regardless of the amount of taxes owed.

McElgunn, a lawyer retained by the county to handle tax foreclosures, explained that the property was being sold as is, with no guarantees. He told the audience he hoped they had done their homework – that they knew the condition of the property they were bidding on. And that if they made the high bid, the property would become their responsibility.

One of the winning bidders, who asked that his name not be used, smiled and said almost giddily that he “jumped in with both feet. I didn’t do my homework.”

He said he paid $500 for a piece of residential property in the 1800 block of South Water. For all he knew, it could be a vacant lot. Still, he said, “An empty lot for $500 ain’t bad, especially in the city of Wichita. I guess I’ll find out.”

County officials moved the …tax foreclosure sales to a massive hall at the extension center because … The sale had outgrown space in a jury room at the Sedgwick County Courthouse.

One of the experienced bidders, Fred Byers, had his eye on a home that ended up going for $47,500.

Byers had done his homework. He had looked at the home and learned that it had extensive damage from pets and needed new plumbing and heating and air equipment. He was prepared to pay $30,000, no more.

See the entire article: http://www.kansas.com/759/story/952439.html

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Coach Mitch’s REFLECTIONS™

Caveat Emptor

It seems that the county is good at disclaiming. The county does not want to be responsible for anything, yet they want you to be very responsible. The county wants nothing to do with anything having to do with the property – except to take it from the owner and sell it for the back taxes.

Disclaimer’s Galore

See the Auction Terms and Conditions Notice for a complete understanding of what the county will not do and what you are required to do. I’ve included a link to the Albany County, NY Notice which approximates what a county typically requires. http://www.albanycounty.com/auction/default.asp?id=861

Buyer Beware – Take this seriously

Albany County Auction Terms: #10) All properties, including any buildings or other improvements located thereon, are offered for sale and sold by the County “AS IS” without representation or warranty of any kind as to their condition, excepting where applicable, the HUD Lead Paint Disclosure for Residential Properties and any other disclosures required by law.

(BTW, one of the reasons that there are so many dilapidated buildings, is that the government requires that lead paint be remediated, i.e. removed. The expense is huge. Upon being ticketed by building inspectors, rather than take on this immense expense, owners abandon their buildings and stop paying their mortgages and property taxes. Yet, the county does not take on this situation that they created by remediating the building. Rather, they let the building sit, act as a haven for crack users, and pass the requirements on to the next owner.)

Continuing with #10) Prospective bidders to whom the condition of a property is relevant…consider having an inspector, contractor, architect, and/or engineer inspect the property prior to bidding.

The NYS Uniform Vendor Purchaser Risk Act shall apply to public auction sales. (Meaning that you engage at your own risk.)

The right, title, interest, claim, lien, and equity of redemption of all persons therein have been presumptively extinguished under said provisions of law, which presumption will become conclusive after two years from the date of the recording of the deed thereof to the purchaser.

(The county takes the property, sells it, and the winning bidder still has to wait two years to gain clear title so that a regular mortgage can be obtained upon a refinance or resale.)

The deed conveying title to the purchaser will be a quit claim deed from the County of Albany containing the assessment roll description of the parcel… and not a metes and bounds description. However, title conveyed to purchaser is subject to: (a) …an accurate survey; (b) all applicable zoning/ land use/ and building code regulations; (c) and easements, covenants, conditions and rights-of-way of record existing at the time of the levy of the tax, (d) current taxes and assessments and water and sewer charges; and e) any conditions established by the County Executive …

(Neither clear deed nor a good boundary is sold, but the county does require the new owner follow all law, on a property that one cannot even determine the boundaries without going to considerable expense.)

Since marketable and/or insurable title to and the actual dimensions and physical location of these properties is not warranted by the County, prospective bidders…are cautioned to consider having a title search and/or survey of the property performed… prior to bidding.

#13) In addition to the purchase price, the approved bidder must pay closing costs… recording the deed and filing any related documentation. Closing costs will also include the title search fee paid by the County (currently $185).

The hypocrisy revealed

It is staggering. The county assumes no risk, allows the new owner no exclusion from any risk, recommends the bidder get a title search and a survey, and the county will not let the new owner have use of the existing title search – a search for which the new owner was required to pay $185.

Only government can do these things and, with a straight face, say they are working for the public good.

Oh yes, I almost forgot the biggest fraud; if the successful bid is higher than the taxes owed, the county keeps the over bid. The county taxes your property, and upon no payment, takes the property, sells it at retail, and keeps the profits.

BTW

Using Coach Mitch’s “Ridiculously Simple System…”™ removes these risks because you are buying the property directly from the tax distressed owner, prior to the tax auction.

Don’t play the tax collector’s game

With Coach Mitch’s “Ridiculously Simple System…”™
you get marketable title with a warranty deed, you can walk the metes and bounds, you don’t have to worry for two years that a relative will dispute the title, you can thoroughly inspect the property at your leisure, you get a wonderful deal, because the owner is going to lose the property to the tax auction, and you can refinance or sell immediately.

Why bother with the tax sales auction, where you have to bid against many others and, in addition, assume all the risks that the county will not?

See Coach Mitch’s “Ridiculously Simple System…” ™ for details.

Caveat Emptor –