Trustee Sales

Trustee sale may occur when a home owner defaults on their mortgage and a lender takes possession of a home, or if a home owner fails to pay their property taxes and the taxing authority takes the property. The public is notified of trustee sales through newspaper classified listings.

Why Trustee Sales?
Typically a trustee sale is attractive because it allows the buyer to make or save money. Reports show "Trustee Sales are generally discounted between 10% and 20% and sometimes the discounts are even greater." (source) But, because of the auction environment and requirements of a trustee sale, buyers do need to be decisive and ready to leap when a good deal appears.

The Requirements and Risks of Trustee Sales

Purchasing real estate at a Trustee Sale is more complicated and risky than purchasing in a traditional transaction. An experience realtor can help you navigate the many steps of Trustee Sales. Some limitations you should be aware of are:

Trustee sales are cash only. When you make a bid you must have cashier's checks for the full amount of the purchase.

There's limited selection of properties. It may take a while for a property that meet's your desires may not come to market.

There's no property inspection before purchase. You will typically not be able to view the inside of the property prior to the sale (rarely properties are listed in the Multiple Listing Service or the current owner will allow previews). Most often any property acquired in a Trustee Sale is acquired "as is" which may include undetectable physical damage.

There's no insurance.  Unlike a traditional home purchase, buyers can't purchase title insurance at the sale that protects against unrecorded liens. It's a rare risk, but it can happen and the buyer is responsible for any claims against the property.

The sale is final. There is no recourse for buyers with remorse.

To make a Trustee sale purchase a financial success requires much research and proper preparation for bidding. You'll be up against experienced bidders and investors. If you are interested in saving your family money by purchasing a property at a Trustee Sale, an experienced Realtor can dramatically improve your experience.