This blog reports events and interesting tidbits from Rensselaer, Indiana and the surrounding area.

Thursday, February 14, 2013

A visit to the jail

On Tuesday morning I visited the jail. I had never been in the building before. I missed the open house that they had when the building was completed because I had an important family event that took me out of town.
My visit was voluntary, and I did not actually see the jail itself. Rather I arrived a bit before 10:00 and waited with some other people in the lobby until a deputy arrived and escorted us up to the second or third floor for the monthly sheriff's sale.

I had no idea what to expect and was not even sure how a property got listed for a sheriff's sale. I found out that the sheriff's sale is part of the foreclosure process. If you stop paying your mortgage, the holder of the mortgage will go to court to get a judgement against you. In Indiana that will result in your house ending up at a sheriff's sale.

In the sale on Tuesday 26 properties had been listed, but the sale of 13 of them had been canceled because the person who owed on the house had reached some kind of agreement with the mortgage holder. In each of the thirteen properties that were put up for bid, a representative of the mortgage holder submitted the initial bid. I could not see any relationship between the bids and the amount of the mortgage that was listed on the sale flier. Sometimes the bid was a bit more than the mortgage amount and sometimes it was much less. For example, on one house the mortgage was listed at $227,966.73 but the bid was $108,000. Here the bid was less than half the mortgage amount. Another house had the mortgage listed as $64,135.14 but the bid was $67,928.08, more than the mortgage.

This last example illustrates one very weird thing about the auction. The opening bids were usually not nice round amounts like $108,000, but more often amount that went down to the penny, such as $96,698.87.

The auction was quick. For twelve of the properties, the opening bid from the representative of the mortgage holder was the only bid. Only in one case were there additional bids. On that property three people got into the bidding and raised the price about $4500 over the opening bid.

There were 13 other people at the auction and I am sure they all knew a lot more than I did or do. The sheriff had a big disclaimer saying that any bidder needed to do research to make sure that there were no liens on the house. In the past few years two properties that were purchased as these sales had unknown mortgages, and they resurfaced to cause problems for the persons who bought the houses.

Now I can cross "Attending a sheriff's sale" off my bucket list.

1 comment:

Anonymous said...

Newspapers usually have legal notices posted in them when a property is going to be put up for auction. I think it is required by law for it to be announced to the general public.

It is pretty common for sales to be postponed or cancelled outright. In my experience it is fairly uncommon (~ 1/50) for someone else to bid on a property besides the mortgage holder.

All sales are final and cash or certified funds usually have to be provided within 24 hours to the Sheriff with a 20% downpayment made right at the time of the sale. The public announcement will usually specify forms and deadlines for payment.

After purchasing a property, I don't think you are allowed to take immediate possession. Someone may still be occupying the property. You'll have to go to court to get the right to evict them, or wait a month.

UA