What to do if i buy an occupied house at auction: legal guide to evict quickly

You feel the adrenaline of winning a house at an excellent price in a judicial auction. You go to the Real Estate Registrar, you register it in your name and you arrive with the keys full of expectations. However, when you open the door you find the worst possible surprise: the previous owner or his tenants are still living there and flatly refuse to leave. At that precise moment, the popular phrase that warns that cheap is expensive seems to materialize before your eyes.

Fortunately, all is not lost and legal relief is immediate. Being the rightful owner on paper gives you the absolute right to demand the eviction of those abusive occupants. Chilean legislation contemplates very specific procedural mechanisms to expel those who improperly retain your property, but the success of this operation requires that you act quickly, without making mistakes and with the most precise judicial strategy at your disposal.

Scenario 1: when the person who does not leave is the previous owner

On many occasions we encounter the situation in which the executed debtor, that is, the person whose house was auctioned off by the bank for not paying his debts, stubbornly refuses to abandon the property he has just lost.

To solve this scenario, the fastest legal route is extremely clear: you do not need to start a completely new and extensive trial such as a precarious trial. Your specialist lawyer must request what is known as Release with the assistance of public forces directly within the same executive trial where the property was auctioned. By doing this, the court will order Carabineros to evict the previous owner by force if necessary to give you the material and real delivery of the property that you legitimately purchased.

Scenario 2: when there is a tenant from the previous owner

This is perhaps the most crucial technical part that every real estate investor must understand. What happens if the original owner had leased the property to a third party who claims to have every right to stay? Are you obligated by law to respect that rental contract that you never signed?

The general rule is clear and favors the new buyer. According to what is established in our Civil Code regarding the extinction of the landlord's right, when a property changes ownership as a result of a mortgage auction, the rental contract is terminated by the sole operation of the law. This means that the new owner is not obligated to honor that prior lease under any usual circumstances.

There is only one exception to this general rule. The new buyer would only have the legal obligation to respect the previous lease if the tenant had his contract signed by a public deed and, in addition, had it registered with the Real Estate Registrar with a date prior to the mortgage that the bank executed. In the actual practice of the Chilean real estate market, this occurs in less than one percent of residential cases.

The worst mistakes new owners make

Frustration and desperation lead many investors to make serious mistakes that end up burying their investment. Below we detail the most common procedural traps and crimes that you should not fall into:

• Cut off basic services: It is essential to remember that going on your own to cut off the electricity or water supply to the house is a completely illegal act classified as self-protection. If you do, the occupant will file a protection appeal against you and you will end up paying expensive compensation.
• Sue for termination of lease: It is a major legal error to sue in court for the termination of a rental contract that you never signed or consented to. The correct procedural action is to demand the restitution of the property due to the extinction of the landlord's right.
• Sign verbal agreements: Giving in to pressure and giving them a couple more months under purely verbal agreements is a death trap. This only consolidates the irregular occupation of the property and greatly complicates the judicial launch that you will have to do later.

Frequently asked questions about houses for sale

What happens if the house was taken over by squatters after the auction?

In this scenario, the new Give Me My House Law directly applies or the beginning of a traditional precarious trial. The choice of the legal route will depend strictly on the temporality and how the irregular occupation was configured after the award of the property.

Who pays the debts for common expenses or electricity bills that they left?

It is important to clarify that unpaid common expenses directly persecute the property. Therefore, the new buyer must assume said debts of the community, hence the vital importance of carrying out a good title study before lifting the palette at an auction. However, debts for basic supplies such as electricity and water can be separated from the property and the new owner.

How long does carabineros take to carry out the eviction?

Once the judge issues the corresponding court order, operational coordination with the public force takes from a couple of weeks to a couple of months. This period will depend solely and exclusively on the availability of the local police force in your commune.

Take real ownership of your investment today

Buying properties at bank auction is, indisputably, an excellent financial business that can multiply your assets. However, the cycle of your investment is not closed until you have the keys in your hand and the completely empty house at your disposal. Don't let excessive state bureaucracy or abusive occupiers hold onto your capital for longer than is strictly necessary.

At terrenoenregla.cl we protect your real estate investment from the first second. Our team of expert lawyers assumes immediate legal representation to request releases with public force in the respective executive trials or process restitutions ruthlessly. We return you full and material control of your property so that you can begin to make your investment profitable without delays.