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Recently, I put winning bid on auction.com purchase for "as-it-is" property in NJ. Property was occupied by previous landlord. Previous landlord was unwilling to provide access for CO inspection to township till date of the closing. 
Auction.com/seller cancelled the deal and provided deposit back. (I didn't cancel the bid. )

Do I have any recourse of getting lawyer fee and other expenses (cost of inspection etc) from Auction.com?  My thesis here is that Auction.com/seller should be aware of situation that property can't be closed without CO and CO can't be obtained without access to property. They had fraudulently listed property without doing research. I will appreciate your views.
Thanks

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Correct. Owner has been living rent/mortgage free for the past 5 years. This particular property has been in foreclosure... (more)

NYKnicksFan (Jul. 27, 2017 @ 11:18a) |

Surprised the bank didn't evict.

forbin4040 (Jul. 27, 2017 @ 11:22a) |

Distressed sales always come with unknowns and drama.
If you know a broker, you can purchase the "non-performing note" se... (more)

ThomasPaine (Jul. 27, 2017 @ 11:27p) |

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Did you call them and see what they say?
(800) 793-6107

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From the auction.com website under their participation terms:

Participant is responsible for all liability, damages and/or costs directly or indirectly arising from Participant’s inspection, visit, or investigation of the Property. Participant agrees to indemnify, defend and hold harmless Seller and Ten-X from any such liability, damages and/or costs, and to maintain all applicable policies of insurance insuring over such liability, damages and/or costs.

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no you do not. i have had that happen before..

why are you not contacting auction.com/attorney?

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forbin4040 said: Did you call them and see what they say? (800) 793-6107

Yes. No help. 

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Herb said: From the auction.com website under their participation terms: Participant is responsible for all liability, damages and/or costs directly or indirectly arising from Participant’s inspection, visit, or investigation of the Property. Participant agrees to indemnify, defend and hold harmless Seller and Ten-X from any such liability, damages and/or costs, and to maintain all applicable policies of insurance insuring over such liability, damages and/or costs.

My challenge is that they are listing property without doing due diligence on their end. Property can't be sold with previous landlord living in it as it can't get CO.
 

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NYKnicksFan said:   
Herb said: From the auction.com website under their participation terms: Participant is responsible for all liability, damages and/or costs directly or indirectly arising from Participant’s inspection, visit, or investigation of the Property. Participant agrees to indemnify, defend and hold harmless Seller and Ten-X from any such liability, damages and/or costs, and to maintain all applicable policies of insurance insuring over such liability, damages and/or costs.

My challenge is that they are listing property without doing due diligence on their end. Property can't be sold with previous landlord living in it as it can't get CO.

  Why can't it be sold?  Isn't it your responsibility to get the CO as the new owner?  And how is anyone living in the house without a CO?

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Glitch99 said:   
   And how is anyone living in the house without a CO?

  Isn't that just for new houses? I don't see used houses advertised as having COs.

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I guess you sue the seller then.

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atikovi said:   
Glitch99 said:   
   And how is anyone living in the house without a CO?

  Isn't that just for new houses? I don't see used houses advertised as having COs.

  This is all local of course, but the city/town requires an Certificate of Occupancy inspection to issue the transfer stamp required to record the deed. I guess he's trying to get a normal closing, but he could accept a quit claim deed.. he just couldn't record it until a judge gave him order of possession.

Bonus fact: you can short circuit this process through foreclosure, which makes this sound almost like a non-performing note/distressed sale/eviction. Is it the Auction.com seller not providing access, or is the Auction.com different from the "previous landlord" ?

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Glitch99 said:   
NYKnicksFan said:   
Herb said: From the auction.com website under their participation terms: Participant is responsible for all liability, damages and/or costs directly or indirectly arising from Participant’s inspection, visit, or investigation of the Property. Participant agrees to indemnify, defend and hold harmless Seller and Ten-X from any such liability, damages and/or costs, and to maintain all applicable policies of insurance insuring over such liability, damages and/or costs.

My challenge is that they are listing property without doing due diligence on their end. Property can't be sold with previous landlord living in it as it can't get CO.

  Why can't it be sold?  Isn't it your responsibility to get the CO as the new owner?  And how is anyone living in the house without a CO?

  
In NJ, property closing can't be done without CO. Each time, house is bought/sold, CO is needed. 

rated:
atikovi said:   
Glitch99 said:   
   And how is anyone living in the house without a CO?

  Isn't that just for new houses? I don't see used houses advertised as having COs.

  In NJ,   Each time, house is bought/sold, CO is needed. 

rated:
ThomasPaine said:   
atikovi said:   
Glitch99 said:   
   And how is anyone living in the house without a CO?

  Isn't that just for new houses? I don't see used houses advertised as having COs.

  This is all local of course, but the city/town requires an Certificate of Occupancy inspection to issue the transfer stamp required to record the deed. I guess he's trying to get a normal closing, but he could accept a quit claim deed.. he just couldn't record it until a judge gave him order of possession.

Bonus fact: you can short circuit this process through foreclosure, which makes this sound almost like a non-performing note/distressed sale/eviction. Is it the Auction.com seller not providing access, or is the Auction.com different from the "previous landlord" ?

  Auction.com is different from previous landlord. Auction.com doesn't have access to property that they are trying to sell. 

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But they refunded your deposit due to the inability to obtain a CO.  They made you as whole as possible based on the contract.  You agreed to hold auction.com harmless for any other costs due to the failed auction when you agreed to the terms of participation. It would be difficult to prove they knew the prior landlord would not allow access to the property ahead of time. 

How  much money are you out?  You already have an uphill battle and legal fees are not going to be trivial.

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Herb said:   But they refunded your deposit due to the inability to obtain a CO.  They made you as whole as possible based on the contract.  You agreed to hold auction.com harmless for any other costs due to the failed auction when you agreed to the terms of participation. It would be difficult to prove they knew the prior landlord would not allow access to the property ahead of time. 

How  much money are you out?  You already have an uphill battle and legal fees are not going to be trivial.

  
It is several hundred. 

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NYKnicksFan said:   
atikovi said:   
Glitch99 said:   
   And how is anyone living in the house without a CO?

  Isn't that just for new houses? I don't see used houses advertised as having COs.

  In NJ,   Each time, house is bought/sold, CO is needed. 

  What if it's a fixer upper that needs a lot of work? Or if its sold as a tear down?

rated:
atikovi said:   
NYKnicksFan said:   
atikovi said:   
Glitch99 said:   
   And how is anyone living in the house without a CO?

  Isn't that just for new houses? I don't see used houses advertised as having COs.

  In NJ,   Each time, house is bought/sold, CO is needed. 

  What if it's a fixer upper that needs a lot of work? Or if its sold as a tear down?

  
Neither. Property is in reasonably OK shape. I am familiar with the area and owner couldn't make payments. She is still living in the home.  
 

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NYKnicksFan said:   
 
  
Neither. Property is in reasonably OK shape. I am familiar with the area and owner couldn't make payments. She is still living in the home.  

  Hmm..wonder what happened on the CO, maybe she refused the walkthrough.

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I can recall looking at a foreclosure property that had a web site address posted in the window for some auction site.
There was a contact named to get access for inspection. I left a voice mail and never got a response.

I looked at the auction terms, and they were incredibly lopsided, the selling price would be winning bid plus $xxxx, the bidder was legally obligated to complete the purchase, the seller was not obligated to complete the sale. I crossed the property off my shopping list. It sold a few months later, for a price I would have been willing to pay. Clearly the "auction" didn't result in a sale.
The web site may have been Auction.com.

Yes, I think it was Auction.com, where bids are non-retractable but sellers aren't obligated until they sign the post-auction purchase agreement.
It looks like the buyer's fee isn't applied to all properties:
https://www.ten-x.com/company/legal/participation-terms/

rated:
forbin4040 said:   
NYKnicksFan said:   
 
  
Neither. Property is in reasonably OK shape. I am familiar with the area and owner couldn't make payments. She is still living in the home.  

  Hmm..wonder what happened on the CO, maybe she refused the walkthrough.

  
Correct. Owner has been living rent/mortgage free for the past 5 years. This particular property has been in foreclosure proceeding for around 5 years. 

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Surprised the bank didn't evict.

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Distressed sales always come with unknowns and drama.
If you know a broker, you can purchase the "non-performing note" secured by the first mortgage for a 50% discount of the mortgage, and have the same rights as the bank to do a modification or a deed-in-lieu of foreclose.
Or you can go to the county auction and purchase a tax certificate, and either get interest or the property in two years.
Either way, you're buying a lotto ticket that will have a hard time getting title insurance.

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