Welcome to The Home Equity Theft Reporter, a blog dedicated to informing the consumer public and the legal profession about Home Equity Theft issues. This blog will consist of information describing the various forms of Home Equity Theft and links to news reports & other informational sources from throughout the country about the victims of Home Equity Theft and what government authorities and others are doing about it.
Monday, December 26, 2016
Active Bidding At Recent Home Foreclosure Sales Creates Sizable Surplus/Overbids, But Some Ex-Homeowners Aren't Coming Forward To Collect Their Cash
In Denver, Colorado, The Denver Post reports:
County foreclosure auctions have become the hottest investment opportunity in town, reaping tens of thousands of dollars in profits for the most unlikely people: the homeowner who lost the house.
Yet getting them to collect the money isn’t always easy, the public trustees who track them down say.
The money comes from people who buy auctioned houses for more than what a homeowner owes the bank or lender who foreclosed. Once lawyers and any property liens are paid off, the homeowner who lost the house gets what’s left. It’s usually a few thousand dollars.
Lately, though, it has been as much as $100,000 or more.
“Some are more than willing to claim the money, but others are hesitant,” said Diana Springfield, chief deputy public trustee for Arapahoe County. “One guy came in recently to ask about (the money), and now we can’t get him to come back to collect it.”
The amount waiting for him: $27,692.
“We’ve never had anything like this. It’s crazy,” said Adams County Public Trustee Susan Orecchio, noting that auction buyers are frequently paying more than what a bank is owed for a property.
There has been a drop of 45 percent in houses sold at the foreclosure auction this year, Orecchio said. But bidders have already paid more than $3 million more than the banks were owed — a 77 percent increase over last year.
And it’s happening all over Colorado.
[B]uyers are trying to outdo one another at a frantic pace. In Adams County last week, two bidders ran at a single property, within moments driving the final price up by $60,000 over what the homeowner owed the bank.
Since June 1, the Arapahoe County public trustee has auctioned 84 properties, records show. Of them, 53 sold for amounts that ranged from $20,000 to more than $116,000 more than the remaining mortgage, records show. Only five have been resold since their auction.
In Douglas County, where the number of foreclosure homes auctioned has dropped by 30 percent this year, the majority have sold for more than what the bank was owed, Public Trustee Christine Duffy said.
Of 67 sales, she said, 42 brought in for more than what the homeowner still owed on them, three by more than $100,000.
Despite the cash, trustees say some of the former owners just won’t show up to collect money that is rightfully theirs.
“I can’t explain to you why they don’t come for the money,” Springfield said. “Some say the depression is simply too much to bear, having lost their home. But these are some pretty hefty checks.”
But sometimes there just isn’t anyone left to make the claim.
“We have one where both husband and wife died and there’s $44,000 in overbid,” Springfield said. “Their attorney said they have no relatives.”
That’s the case for Robert Gray, who lived in Westminster during the summers and wintered in Florida. He died in 2013, and his Colorado home was foreclosed and sold at auction in February 2014, records show.
Gray, a retired psychologist from Oregon, had no known relatives.
The $121,999.97 that belongs to him will sit in the state treasury until someone makes a valid claim.
CBC News: Betrayal of Trust (A CBC investigation reveals how lawyers across Canada have misappropriated and mishandled clients money, to the tune of tens of millions of dollars, or sometimes even charging vulnerable people top dollar for shoddy services)
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