Hi all, first post but long term lurker of these forums.
I hope to purchase my first foreclosure property in the coming week and need the community's help (topics: Ch13, automatic stay, liens, etc.) I hope this post will help me but also benefit others as it seems common in foreclosure auctions. So here goes:
Prework - i did the title search and the foreclosing party is the senior creditor on the property. The property is currently occupied.
1. Chapter 13 bankruptcy
Fact: the debtor filed Chapter 13 plan and motion indicating in section E that the property will be surrendered (Upon confirmation, the stay is terminated as to surrendered collateral only under 11 U.S.C. 362(a) and that the stay under 11 U.S.C 1301 be terminated in all respects. The Debtor surrenders the following collateral: real estate address)
Question: Does this mean that the debtor forfeits rights to the property, vacates immediately (stay terminated), title transfers to the lender, and foreclosure can occur right away on an empty house? Any tricks the homeowner can use to stay on the premises? The debtor is under a 3-5 year plan in which he surrendered the property. Can he remain in the house until foreclosure? Would eviction process be the same here as non-bankruptcy foreclosure? My fear here is that the court approves a 3-5 year plan and that will allow the debtor to remain on the property for that time period.
2. IRS Lien
Fact: There is a substantial IRS lien on the property. This lien was filed after the senior mortgage lis pendent. My understanding is that the IRS has 120 days to redeem the property for the price paid at auction
Question: Is my understanding correct?
3. Foreclosure Sale - day of
Fact: Auction scheduled for the coming week. I secured the funds, ready to bid
Question: What happens when I win the auction in terms of deed transfer, when can I access the property (10 day redemption period in NJ - but property surrendered in Ch 13?), any other documents to fill out in the county clerk office, etc?
That is all I can think of now. Thank you all for the responses and I will keep you posted!
