Can you buy a home that goes to auction if you are related to the seller?

Asked by Nm82, Union Grove, WI Sat Apr 11, 2009

A home we are interested in was owned by my boyfriend's second cousin. It is currently being sold as a "short sale". I have been told that anyone in "arm's length" of the seller is prohibited from buying the house. I understand this part, but if the house is scheduled to go to auction at the end of the month, are we still prohibited from trying to buy it through the auction? If not, any information regarding buying through an auction would be appreciated. Thank you!

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Vicky Chrisner’s answer
Vicky Chrisn…, Agent, Purcellvile, VA
Sun Apr 12, 2009
Nm82 - generally, yes, there is a prohibition against this. But, consider calling the trustee listed for the foreclosure. You should be aware of how auctions typically work. Generally, the bank will bid what is owed to them, which is generally more than the property is worth, so you'd probably end up overpaying dramatically for the property. See the post below.
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