Not-So-Merry Xmas For 'Rookie' Winning Bidder At Foreclosure Sale Who Shelled Out $300K For Property Despite Never Having Done Satisfactory Title Search/Other Due Diligence; Woefully Discovers Premises Comes 'Fully Equipped' w/ Unforeseen Existing 1st Mortgage; Courts On Buyer's Mistimed, Post Hoc Effort To Protect Its Interest: Take A Hike!

In Miami, Florida, the Daily Business Review reports:

• The Third District Court of Appeal ruled against a Coral Gables-based investor who found out too late that a property it purchased in foreclosure came with more strings than anticipated.
  
  Residential buyer Thriving Investments LLC was a third-party buyer in a judicial foreclosure sale. It paid about $300,000 for the real estate in Miami's garment district but later learned it did not own the property free and clear and was subject to a pre-existing debt.
  
  It turns out the final judgment only foreclosed a second mortgage, leaving a superior claim on the property.
  
  The new buyer moved to set aside the final judgment that paved the way for its foreclosure purchase.
  
  "These people just didn't do their due diligence," Hollywood attorney Louis Charles Arslanian told the Daily Business Review. His client, FVZ Inc., holds a mortgage on the property.
  
  "Even if they had standing, the problem is when you buy in foreclosure you need to know whether you're buying second, third or first," he said. "You've got to do your homework."
  
  Thriving Investments' attorneys—Aliette Rodz, Stephen Maher and Alfredo Gonzalez Jr. of Shutts & Bowen—argued that as the successful bidder at the foreclosure sale, their client had standing to challenge the underlying judgment. They argued the foreclosure should never have been finalized because the foreclosing plaintiff, as holder of an inferior mortgage, lacked standing to foreclose in the first place. They also contended the underlying motion for summary judgment contained factual errors and that the judgment awarded too much interest.
  
  But FVZ's attorney, Edward Holodak of Plantation, countered that the bidder had no right to challenge the outcome.
  
  A successful bidder "can only raise issues as to the sale, and in this case there was no question that the sale was conducted properly," Holodak said.
  
  Miami-Dade Circuit Judge John Schlesinger agreed, as did the Third DCA, which dismissed the case. Holodak said his client plans to seek attorneys' fees for the appeal.

Source: 3rd District Court of Appeal Rules Against Coral Gables Investor in Foreclosure Sale.

For the court ruling, which was issued two days before Christmas, see Thriving Investments, LLC v. Chao, No. 3D15-1599 (3rd DCA December 23, 2015).