Redemption Period And It's Impact On Junior Liens In New Jersey
R/E Creative Investor Forum,
Please advise on opportunities to purchase R/E during the Redemption period after the Sheriff sale.
It's my understand that in NJ the homeowner has 10 days to redeem their property back from the foreclosing lender. Here are some initial questions:
1] Is the redemption period in Calendar or Business days?
2] What is the redemption buy-back $ figure to the homeowner?
3] If there are junior liens on the property, are they wiped out when the banks "wins" at the sheriff sale or do they remain on the title until after the redemption period?
4] Does the redemption price include any junior liens and other fees beyond those presented at the Sheriff Sale?
It would be great to buy the R/E property from the homeowner during the redemption period if they are truly free of any junior liens.
I appreciate your advise and/or external reference to the above.
Thanks.
CBRE-SCM
I am full time investor who does a lot of deals in New Jersey. I’ll try to answer your questions as best I can:
1) Calendar Days
2) The judgment amount plus any fees approved by the court after the judgment. In simpler terms, it’s the amount that is announced at the sale.
3) If the property is redeemed, it is as if the sale never occurred. Therefore, all liens are still on the property. If the property goes back to the bank, the deed is not delivered until after the redemption period is over.
4) The redemption price does not include any junior liens, etc. Essentially all you are doing is paying off the mortgage that is foreclosing.
Couple of other things – you can extend the redemption period under certain circumstances.
As far as buying the property in the redemption period, you would still have to deal with the junior liens. You would have significant leverage given that if the bank took the property back, the junior liens are 10 days from getting wiped off. Many times they will deal with you but often they have already written this loss off.
Does anyone know the redemption period in Florida? And am I correct in understanding that in order to redeem the property the amount must be paid in full? There is no opportunity for catching up on back payments? Also, does this mean that if I take a property Subject To, or Get a Short Sale on a property facing forclosure the old owner can still redeem the property? Or they can only redeem if it has gone to auction?
I am not from Fl but the last two questions are universal. If you buy sub2 you stand in the shoes of your seller as far as the loan goes. If it goes to auction you will loose it unless redeemed. Short sale is where the lender agrees to take less than the mortgage balance in cash. If you pay them off they will not foreclose. I assume here that you really did not understand what a short sale is. I hope this helps a bit.
Hope this helps some
Ted Jr
thank you tedjr. I'm familiar with the shortsale process, i guess i didn't phrase the question properly. I was saying if a SS has been negotiated but by the time the financing comes in it has already gone to sale can you still redeem it at the SS offer. And after reading everything I'm guessing No you must purchase it back Cash for the amount it was sold. So, my only question that still remains is if I take a property sub2 and then lease it back to the original owner what type of redemption or equity recoupment trouble am i getting myself into, other than them not making the monthly payment which i expect to happen?
Tedjr, one last question, so you're saying that if i've recorded the Deed to trustee and the property goes to auction, as the trustee i have the right to redeem that property?