What to do about a foreclosure and auction of my home?

UPDATED: Aug 5, 2011

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What to do about a foreclosure and auction of my home?

I just went through the foreclosure process – my house was up for auction a couple of weeks ago – I just got notice today from the court that my house sold at auction – the starting bid was $77000 – the house sold for $117,000 – but it states on the paperwork that the purchaser was my mortgage company? Why would they pay so much money to keep it if other people were bidding on it? And since I only owed $105,000 on it do I get any money back since they bought it for so much?

Asked on August 5, 2011 Ohio


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

The reason why your home ended up being sold to your mortgage company which had the first mortgage (or trust deed) on your property was due to the fact that it had a credit bid on the auction. The credit bid would be the principal amount owed on your loan unpaid, accrued interest on the loan which would include payments not made, costs of the foreclosure, attorneys fees, trustee's fees and recording fees.

The reason why your mortgage company paid the $117,000 amount was that due to its credit bid. It was driving up the price of your former home with the hope to actually break even on the sale at worst scenario. With the mortgage company ending up on legal title to your former home, most likely it did not break even on the foreclosure sale.

Although you owed $105,000 on the mortgage, there were the monthly payments you did not make, accrued interest and other fees allowed the mortgage company to claim on the sale. If your mortgage company was paid in full on the trustee's sale and ended paying monies beyond its credit bid to get your former home, then you would be entitled to any net excess.

Good question.


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