Buying a foreclosed home through an auction may get you a great deal on a house, but it may also come with some unusual complications–like the former owners still living inside.
While the foreclosed owners do have to leave eventually, every new owner fears the worst: They may be tempted to do a little damage on their way out.
As a residential property owner or real estate investor, you probably don’t have the bells, whistles and legal might of an investment hedge fund. For you, this is probably the only time you’ll have to evict someone and you don’t want your new house destroyed in the process.
But it doesn’t have to be a complete headache. You can take some cues from the big boys and borrow a strategy those hedge fund investors and lenders have been successfully using throughout the country to get in-tact homes away from their former owners.
Option 1: Offer to pay the former owners a cash subsidy if they leave the house untouched
You can approach the people and offer a sum of $5,000 or more to leave the house intact. You can put that money in an escrow and let them know that it’s theirs as soon as the property has changed hands without further complications, as long as certain stipulations are met. Let the former owners know that you are sorry that things didn’t work out for them but you’re excited to take good care of their house.
It’s worth it to offer a substantial amount of money because your other option will cost you just as much, if not more. You want the former owners to seriously consider your offer before you move on.
Option 2: Hire an attorney
If the cash subsidy doesn’t work, you’ll want to consult with a real estate attorney. Evicting people is emotionally and legally challenging and it will take a while. The eviction process will cost you in lawyer fees, court fees and a lot of wasted time. And after all that, they may still trash the house on their way out.
This is a very tricky and sensitive situation for all involved. The former owners have probably already seen a lot of heartache with their home and you’ve gone through a lot to get a new house, so proceed carefully and look for amicable solutions instead of legal battles.