Bank selling farm

A friend of mine just informed me that his neighbor and the neighbors brother farms were being sold by the bank and county default on the loan and taxes what we were wondering is if they got a load by some others means could they buy it back at the sale the sale is tommorow?

I would not think that the bank would sell it back to them, unless possibly they were willing to pay more than what was owed. Otherwise, they could possibly work out a deal with a friend or relative to buy it and then buy it from them later.

I doubt they can get a loan from one back if another is foreclosing??? However, if anyone shows up with CASH at a foreclosure sale and their bid is accepted by all parties (bank and county all happy) ITS THEIRS....Subject to any statutory redemptions. In our county you have like 2 hours to deliver certified funds or cash so you have to have all your ducks in a row and the cash ready.

John T Country Lawyer

A 220 acre farm near me sold for the same reasons a few years ago and the same people bought it back for about 50 cents on the dollar.I see that all the time with sheriff's sales at the courthouse.People get in over there heads or the property isn't worth what they paid for it.

This is one way for the bank to clear up the title, so most likely
the bank will buy the property they already own.

It's kind of a legal maneuver, they don't plan on anyone
actually buying the property.

You'd have to bid more than the loan was.

The folks won't find a bank willing to deal with them to put up
enough money to take over the bank they are already
defaulting on.

If friends or family do so, it can be done, but doesn't look like
there is enough time to pull that off, and who is going to risk
that much money, has that much cash sitting around?

Some states allow some time after the sale for the folks to
reclaim the property. That night be a possibility. If they so
ehow get some cash together.

It's tough once you get behind, just very hard to paddle your
way back up to even, much less try to get ahead.

Paul

I don't think that won't discharge the debt without bankruptcy will it?

With us on a tax sale,the buyer does not get title to the property for a year. The debtor has the right of redemption by paying the purchase price plus interest. Bank sale does not get you off the hook if it is sold for less than the amount owed. Bank usually bid the amount they are due.

Depends.

The bank may have accepted the land back for payment in full if the borrower didn't go through bankruptcy. Allows everything to happen fast rather than tying it up for a while in bankruptcy. The only issue is the amount the bank writes off is now taxable income to the former borrower. The bank will issue a 1099 to them for the amount the bank lost.

Tax wise your best year ever could be the year you went broke.

A bankruptcy sale or in Indiana it's called a sheriff's sale, you have to show up with a letter of credit from your bank. The price you will pay at the sale is what the bank is out, plus interest, plus back taxes, plus the interest on the taxes, plus Lawyer's fees.

A bank has to go through a sheriff's sale to get the property in their name.

The bank will bid up to the loan amount plus any legal costs already occurred. So if they have the $$ they should have just paid off the loan prior to this.

I only heard parts of the story the way i heard several family members from out of state want to bail them out just don't know why they just didn't go to the bank and make the note current

You didn"t say which state, laws vary.

I went to a foreclosure auction once where a guy bought the note from a bank and foreclosed on himself. Brighter than me, he knew that the only way the holder of the second note could come out was to outbid him at the auction. Didn"t happen and the holder of the second got nothing, losing $40k.

Here, highest bidder gets the property, no matter what the bid. The holder of the first (who usually forecloses) needs to attend the sale to ensure that the sales price is higher than the loan. I"ve been in that position, ready to bid.

First the attorney and taxes are paid, then note holders, in order, until there"s no money left.

Sometimes it works out better to not make the loan current and go through foreclosure. Depends on how many claims there are on the property, or a gamble that the first claim will not want to own the property after the sale, preferring to take a loss.

Lots of ways this can shake out profitably.

I had an attorney teaching a RE class in Champaign, IL. He told of a client in this position. Farm Credit won the bid but did not bid what was the total default was. This was, I think prior to the sheriff sale. Then just 10 monutes before the sheriff sale, the owner lined up some one to buy the property and he was going to keep the buildings. They bid just over the amount that Farm Credit bid in the limited time and got the the property back. Farm Credit lawyers messed up and it cost them $75K.

I would think in todays paper shuffle, this could not happen. The only thing worse than banks to deal with would be credit cards or loan sharks at 20 -30% interest.

The worst thing is most people wait about two years too late to try to do something about their situation. They keep thinking that things will get better, prices will go up, and etc. The quicker they act the better things will be unless the banks favorite customer wants the farm. And a bankruptcy will bring on a divorce or a divorce will bring on bankruptcy.

Hope they get things worked outsome what in their favor.

I don't know. I am not a lawyer and don't profess to be one.

Many years back when moved, first moved to Illinois and was renting, I decided to buy a home. They used to run commercials, and maybe still do, for foreclosed upon homes, buildings, property. All I had to do was send them something like $100 for a list of foreclosed upon properties in the counties that I was interested. Seemed like a good deal to buy a fixer upper and... So, I was looking at properties, and as I was, there was a story in one of the big news papers that caught my eye. Basically it said that if your property was foreclosed upon in Illinois, at least at the time, if you could come up with the money owed, back taxes, whatever, within five years of the foreclosure, you can get your property back. That isn't what I had in mind when considering purchasing a foreclosed fixer upper...to have the old owner show up and see that I fixed up their foreclosed fixer upper, come up with the $$$, a fraction of what I would have put into the place, and take it away from me. That ended my intersts in purchasing foreclosed property.

What does that do for your neighbor and neighbors brother wherever they may live? Perhaps some of it might apply down the road.

Mark