Friday is the day when the County schedules foreclosures for Daytona area properties. Used to be 2 days a week on average 30-35 properties a day. Not anymore. Today after a few cancellations, which is very common, there were only 5 properties left on the foreclosure list.
I drove all the way to Deland, our county seat, because there was one condo-hotel unit in Oceans Jewels Club going on the chopping block. The foreclosing bank is known for the deepest discounts, starting from 10 cents on a dollar of the balance of the loan. I did not expect 10%, but I figured that it was making sense if they would go for 40%.
I knew that the amount owned to the association was $16K, and it was making this deal not really likely. By law, no matter how the Buyer obtains the title, s/he is liable for the debt to the association in full. And if s/he does not pay in 30 days the Association can foreclose and end up owning the unit free and clear.
However, if the lender forecloses, then the Lender has to pay either one year's worth of maintenance fees or 1% of the original loan amount, whichever is less.
We tried to call the CAM (Community Association Manager) and ask whether the Board would consider accepting less money. It made perfect sense, as if the unit is foreclosed by the bank, then the association will only get about $400 (1% of the original loan amount, which was only about $40,000).
But we could not reach the manager.
While on my way to the auction, she called and explained that last time they had a similar situation, they only agreed to knock down late fees and interest, so we would probably have to pay $14K out of $16K if we buy the unit.
15 minutes before the start of the auction, I learned that the minimum the bank would accept was not 40%, as I hoped, but 60%, and it made the deal a loser. Just in case I called and asked to be connected to the manager, who again was out of the office, but they told me that she had already explained to me everything, so what on earth I wanted from them?
10 minutes later the bank took it for $100. There was no bidding. Sure, it made no sense. This is a shameful story how today the Association ended with $400 instead of $4,000 that I was offering.
What difference does a good offer make if nobody’s listening?