Foreclosures, Court Ordered Sales and Other Distressed Properties For Sale in Okanagan Shuswap
Call it what you will - Receivership, Foreclosure,Court Ordered Sale or Opportunity - there are properties on the market that have been forfeited for various reasons by the registered owner.
There is a special process for purchasing a foreclosure property in BC and it begins by an application for the sale of the property to be carried out under the supervision of the court. We won't go into details about who can make application - or the reasons why because the focus here is on the BUYING process.
- A Demand Letter is sent to the Borrower - giving them a short period of time to pay their mortgage.
- Then a petition is filed in the BC Supreme Court Registry which starts an action: The Order Nisiwhich fixes the time period for redemption (the time available for the borrower to redeem the mortgage as well as the amount required) This is usually six months.
- Once a conduct of sale has been granted - the receiver acts as the Seller (only for the purpose of selling the property) and they may now list the property for sale with a REALTOR.
- At this point the property is listed for sale - and potential buyers begin to view it.
- When a party is interested - they work with a REALTOR - (either theirs or the Selling Agent) to write an offer which is directed to the Seller.
- The Offer may contain any number of "conditions" or "subject to" clauses.
- The Seller will have a clause stating tier conditions - often in a "Schedule A" which will accompany the offer.
- One of the Seller subjects will be - in essence "Subject to Court Approval"
At this point - it is important to understand that even though the Buyer may negotiate with the Seller - and a deal may be agreed upon, there is still a possibility that when the offer is presented at court, the offer may encounter the sealed bid process of other offers in court.
- Once the offer is made, the negotiating process is similar to any other Real Estate Transaction
- After a deal is reached - the Buyer works to remove the conditions or subjects as they would in any real estate transaction.
- If the Buyer removes all of their subjects in the time specified within the offer, a court date is set.
This is an anxious time for Buyers. It is difficult not to become emotionally involved in the process. Normally once a Buyer removes their subjects - they know they have secured the property they are interested in.. not true for the court ordered sale! The Buyers offer still must be approved by the Court. Once in Court - the process looks like this:
- The Seller's Lawyer presents the Buyers offer to the Judge
- The Judge asks if there are any other interested parties in the courtroom that would like to submit an offer.
If there are no other offers - the Judge then ensures that:
- Appropriate Marketing has been done to attract potential buyers
- The price of the offer is market value.
If there are competing offers:
- All parties (including the original Buyer) will be instructed to leave the courtroom and resubmit their FINAL OFFER in a sealed envelope to the Sellers Lawyer.
- Offers are opened and compared - and the Court (Judge/Master) compares, evaluates and accepts the most favourable offer.
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