I saw this foreclosure notice on a property I might be interested in. How do I go about buying it?

The foreclosure notice has a sale date in it. On that date, unless the foreclosure sale is postponed for some reason or the foreclosure has been terminated because the default has been cured, someone will be at the courthouse lobby to cry an auction of the property. Our client will start the bidding, usually with the amount it is owed. We will not know the exact bid amount until some time before the sale, but you can estimate it by taking the principal balance figure in the foreclosure notice and adding something for interest, late charges, and foreclosure costs. This may be 5 or 10 percent or more of the principal balance. Check our website to see if the offset bid is posted.

Do you take personal checks?

No. Bidders must have their funds in the form of cash or a cashier's or certified check drawn on a local bank Personal checks are not accepted, nor may you bid on credit. You must have the funds at the sale; you cannot bid and then go to the bank and get the money if you are the successful bidder. You will be asked to qualify as a bidder by showing your check either to our employee or a representative of the title company acting as trustee. This is to assure fairness in the bidding procedure.

How will I know how much to bid?

Check our website a day or two before the sale, and with luck we will have our client's bid information online. However, because other parties may show up to bid as well, you should be prepared to bid more than a dollar over this amount. If you bring a cashier's or certified check to the sale, you can have it made out for the maximum amount you are willing to bid. If you are the successful bidder in an amount less than that, the title company acting as trustee will issue you a refund check for the difference along with the deed to the property. This might occur several days after the sale.

To whom should I have the check made out?

To the title company acting as trustee for the foreclosure, not to our firm. The title company will be identified in the first line of the notice of sale published in the newspaper, or it will be the title company that signed the notice posted at the courthouse. It will not necessarily be the title company identified as the original trustee.

Can I inspect the property before the foreclosure sale?

Our client does not own the property now and will not own it until after the foreclosure sale, if ever. It therefore cannot give you access to inspect it if the property is still occupied. We cannot stop you from asking whoever is in the property if you can inspect it, but they are not obligated to let you, and they may not be happy about being asked. If the property is vacant, our client may have secured it to protect it from damage, but generally it will not want to give anyone access to it due to liability concerns.

Can I buy the property before the foreclosure sale?

Our client does not own the property now and will not own it until after the foreclosure sale, if ever. It therefore cannot sell it to you before the foreclosure sale. Only the current owner can do that.

Can I buy the property after the foreclosure sale for whatever the bid amount was?

Probably not. Assuming our client is the successful bidder, it may be obligated to transfer the property to a government agency such as the Department of Housing and Urban Development or Department of Veterans Affairs, and those agencies will then put the property on the market in the usual way. Even if our client will be marketing the property itself, it also will probably market it by listing it with a realtor.

If I am the successful bidder, what happens then?

You pay the title company acting as trustee the amount of your bid, if the title company has a representative at the sale; if not, give it to our employee or agent, and it will be forwarded to the title company. If your check is for more, the trustee will cut a check back to you for the difference. It will also issue you a trustee's deed to the property. Once that is recorded, the property is yours. It will be up to you to evict anyone living in the property if they do not leave voluntarily. Bear in mind that all properties are sold "as is."

Can I get a copy of the title report?

Yes. We will provide you a courtesy copy for a fee. Bear in mind that you are not an insured in the policy, and that we do not guarantee the accuracy of the information contained in the report. You use it at your own risk. You can also obtain a property profile from a title agency, which contains minimal property information. We do not guaranty the accuracy of any title report. If you require more information, a limited liability report from a title company generally costs about $250. In addition, the Recorder's Office now has a web site at which you can find information regarding documents recorded against a property. The address is: www.dnr.state.ak.us/recorders/search. Please read the additional disclaimers at that site.

Is there insurance on the property that would protect me if I purchase it?

There may be insurance on the property, but it would not protect your interest as the successful bidder. You should make arrangements with your insurance agent as soon as possible, even before the foreclosure sale.

Does the property come with any warranties?

No. Our client does not own the property, has probably never owned the property, and probably has little idea of what condition it is in. The property is sold "as is, where is," with all faults, and without warranties or representations of any kind as to condition, habitability, occupancy, value, code compliance, status of title, or anything else. You are expected to have done your own research as to these matters.

What if I change my mind after the foreclosure sale?

All sales are final, with two exceptions: if the borrower or someone else with an interest in the property filed bankruptcy prior to the sale, the sale was void and you will have to be given your money back and the title will remain in the name of the previous owner. Also, it sometimes happens that a payoff or reinstatement of the loan will occur at the last moment, and we do not get word of it before we cry the sale. In that event also, you will be refunded your bid amount and will not receive a deed to the property (or any deed will have to be rescinded).