It’s not quite finished, even if you win the bid at the foreclosure auction. There are several steps you need to take to pay off the remaining balance and protect your interest in it.
Step 1 Pay the remaining balance
You should be able to get a list of property conditions from the Deed Registry or people holding the auction when the purchase is complete. You should read the conditions or consult your lawyer if there is anything you need to pay attention to. It’s common that you don’t have to pay full price when bidding at auction right away. You will have up to 30 days from the date of the auction to settle the remaining balance. However, in some extreme cases, you only have a couple of days or a couple of hours to pay off the remaining balance. So be sure to check the conditions of the property with the help of your attorney as soon as possible. Once you figure it out, pay the full amount on time, or you may lose your deposit and property
Step 2 Register the deed
After making the full payment, you will receive the property deed. You should take the deed to the county clerk’s office or deed registry and have it recorded. This step is very important. It allows you to protect your legal claim on the property. In some states, the first to file the deed gets the strongest position. That means if someone filled out a deed and claimed they bought the property, you put yourself in a difficult position at the risk of losing the property.
Step 3 Get insurance
Title insurance protects the financial interest of a homeowner or lender in real property against losses due to defects in title, bonds, or other matters. It is best to use a title company that is familiar with the foreclosure process. Another insurance you should have is property insurance that protects the property from any major damage that occurs during the redemption period. You can easily get a homeowners policy from your insurance agent, so do so as soon as possible to protect yourself from any loss.
Step 4 Notify the tax authorities and return the overbidden money if necessary.
The foreclosure attorney generally notifies the IRS prior to the sale if the IRS or the state has an income tax lien on the property. However, it is best to let your attorney verify it to avoid any unnecessary disputes. You may also need to return the oversupply amount to the homeowner if you bid more than is necessary to cover the property bonds.