This courtesy of www.BluegrassForelcosure.com.

Many folks approach me asking for tips on going to the Master Commissioner sale in their respective county.  Consequently, I am going to work on a series of tips for individuals who want to know more about an MC sale, what to expect, and how to find that hidden gem of an investment.  So if you have specific questions about an MC sale, then please leave a comment or drop a line.  I look forward to hearing from you.  Here is tip #1:

What is the Master Commissioner?

So you have listened to the late night infomercials and are wondering how to get into investing through foreclosure sales.  But you are not sure what goes on here in Kentucky and how foreclosed property gets sold.  Here you go.

Kentucky is what’s called a “judicial” state, meaning the bank or other financial institution must go through the court system, file a foreclosure action, and get a judgment along with an order of sale, to be able to have the property transferred back to them.  As many of you know, the note you sign when you buy a house or real property is the actual contract that obligates you to pay back the bank.  The mortgage, on the other hand, is simply a lien against that house, building or real property, in favor of the bank as collateral if you should default on your note.  That’s why sometimes only one spouse has to sign the note, but both spouses must sign off on the mortgage.  We can go over that in another posting.

So, back to the foreclosure process here in the Kentucky.  Once a judgment and order of sale has been entered by the court, a separate order gets entered which directs the Master Commissioner of the county to sell the property.  Many of you have heard of sheriff’s sale, which is the entity in many states that is authorized by statute to sell foreclosed property.  Here in Kentucky, the authorized entity with power to convey foreclosed property is called the Master Commissioner.

Each county has one and only one.  (Except maybe Robertson, which may not have one since it is so small).  The Master Commissioner is essentially a political animal.  He or she is an attorney and member of the local bar.  They are appointed by the circuit judge of the county, so they are usually well connected.  It’s usually good to be the Master Commissioner and he or she is authorized by statute to convey foreclosed property from a debtor who has defaulted back to the bank or possibly some other third party entity.

I hope this helps to begin explaining the process.  Again, send me an email or leave a comment to this post I will be happy to answer your questions.  I look forward to hearing from you.