Buyers of foreclosed homes through courthouse auctions are finding interest from an unusual crop of clients: the original owners who are still living in the homes.
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John Helmick, the chief executive of Gorilla Capital in Eugene, Ore., bought four homes this year that he sold back to the original owners at a discount.
Last week, he bought a house at auction and within six hours had sold it back to the original occupants in a pre-arranged deal. Helmick pocketed $10,000 for his trouble. The defaulted homeowner paid $93,369 for the home, which extinguished a $130,000 first lien.
"Is this going to be a trend, the new way to strategically default and refinance your home?" Helmick said. "I sure hope so."
