How do you find a reputable source of foreclosures to buy?

Here, either the bank hires someone to fix up the property and sell it, or they auction the property on the courthouse steps.

The auctions have to be announced in a certain number of places, so you can learn about them through the "penny saver" newspapers.

I know you have to have proof of financing before you can bid, which is tough because most banks require an inspection and/or appraisal before they'll lend the money.

I don't know how you inspect the properties before bidding, though.



Had a friend that was a realtor that made his living this way for a while, buying run-down properties and flipping them. We've lost touch, though, so I don't know how he's doing now.

Thanks for the info, DrewDad. Much appreciated.

In the fullness of ignorance, I'm betting most properties are sold in accordance with the market, unless at auction where sometimes people get a little nuts.

Here ya go, Kicky..

http://latimesblogs.latimes.com/laland/

I remember about 12 or more years ago there were lots of foreclosures. I remember there being auctions advertised. In one case, there was a huge auction where they listed 100s of places in the NE area that were being auctioned.

They even had "open houses" when you could view these properties. We looked at several in Boston. One was trashed beyond belief - everything was removed - the floor was warped - the walls were destroyed. It was incredible the amount of damage done to this condo. It was a good thing we looked at them because this condo was in an ideal location and you would have thought if you got a really low price at the auction it almost didn't matter the condition, but this place you could barely even safely walk in.

We also looked at one in Newport, RI - funny we couldn't get their during viewing hours so we thought we would just try to look in the windows. My boyfriend tried opening a window and crawling in for a good look - while he was doing this - I tried the door it was unlocked, I walked in where he was just completing his break in. Another great location, but would need lots of work.

You definately need to view these places first. People get very angry when they are about to be foreclosed and many rip and destroy the property - they take out sinks, toliets, cabinets, and destroy completely. There was a recent article about this.

First off......by all means, DO inspect the property AND protect your investment by an owners policy for title insurance. A lenders policy is normally what you see on the Hud, but this only protects the lender, not you. You don't want Joe Blow's uncle staking claim to the property for some silly note that wasn't picked up in a title search as a lien against it. Likely? Nah. Possible? Yeah.

Kicky ... A good place to start is with your sheriff's office. Here where I live, all the upcoming auctions for foreclosures are listed on their site, along with the auction date. This is all online. If it's not online in your area, call them to see if you can get a list. Here's what mine looks like where I live. Sheriff's Office
When you click on that, look to the left and you will see sheriff's sales listed under resources.

It is cool to look for NOD's (notice of defaults) and if you are really interested, you can try and do a short sale PRIOR to the auction even happening. This way there are no bidding wars and you can generally get a cheap price this way too. NOD's are recorded. You would need to go to your county courthouse OR see if they are listed on the recorders site online. There is way too much for me to even try to type here, giving you tips on handling short sales. Some real estate agents do get properties in where the owner is trying to avoid a foreclosure and will list with a real estate agent ....and from that point, an offer to purchase is used in the negotiations with the bank to get them to settle for less. A couple years ago, I did the financing for a client of mine that purchased a home through a short sale. The payoff on the property was 186,000. The bank accepted a payoff of 118,000. All he needed was a purchase contract signed and my opinion letter and it was a done deal shortly after the bank accepted the offer. It was sweet and easy. Sometime short sales are hard to get done. Just depends....but worth a shot. Especially these days when foreclosures are huge on their books. I had another client purchase a home that was valued at 190,000. That was a true value, too. It was off an appraisal that I ordered on it.....NOT the sherrif's office supposed appraised value. Only 3 years old. In the country on 5 acres. It was an REO. He got that puppy for 88,500. I **** you not. I work MOSTLY on the commercial side of things ( the big cats) but I also deal with a ton of investors. Each one has his own way of doing things...but in the end, it all comes down to the same thing. The winner is gonna be the one that finds the worm first and has his financing in order.

Most people wait till the auction is over and the home then becomes an REO. (real estate owned) This simply means the bank bought it back at the auction and listed it with a real estate agent for sale. For these homes, just call your real estate agent and tell her to give you a listing AND keep you notified of all new listings. Keep in mind that the bank sends a representative to each auction to protect their interests. They will try and run your bid up sometimes. :wink: If you don't bite..no biggie. They come prepared to buy it back, anyhow. Since most banks books are overflowing with foreclosures ....you can get some great deals AFTER the initial auction. I have seen some sweet contracts fly through my bank.

Don't forget about Hud Homes For Sale. Just keep in mind on Hud properties, the bidding will initially open up for "primary residence borrowers." After so many days if no sale has been made on the property.....bidding will open up to investors.

Kicky......there's a ton of information out there. Don't pay any of those sites. Do your own homework for free. If you need any help as you go along....shoot me a pm and I will help ya all I can.

Oh yeah..... one more thing. I also keep track of what's sold at a foreclosure in my county by going to my county auditors website and searching on the first day of each month, as it allows you to search by sales. When I bring up the listing ....I then seek out the names of banks , fannie mae, hud, VA, etc., ....if you do this, you will have the listings before the real estate agents have them, even. Cuz you are getting YOUR listing shortly after the new deed is recorded.

Thanks guys. Especially you, Brooke! Wow. That post is just packed with good information!

When i move out and get my own place and it forecloses because im broke i will get ahold of you and give you details. Does that help?

Hey, thanks, John! That would be a great help. Just let me know.

Lol, i got your back, im just going to move in with kevin garnett anyways. He agreed to split his paychech every week with me and add onto his house for a place for me to live, because im his biggest fan. If things with my foreclosed house dont work out you could always try making things work with your man kobe!!


lol

I bought my house, a foreclosure back in 1991, here in Austin.

We had simply gone to a realtor that someone recommended, not particularly looking for a foreclosure, but we didn't have a lot of money.

Nice old guy, showed us a few houses, actually brought up foreclosures himself.

We were driving by one on the way to a non-forclosure house, and he asked "Would you be interested in something like this?"

We didn't end up buying that one, but he started including them in the mix.

kicky, do you know any realtor, or have a friend who can recommend one?



I'll tell you kick, ours ended up being a real fixer upper, but I never for a minute regreted getting one once, especially when the mortgage payment was due.

Kicky
Where I live the foreclosures are listed in the newspaper under the legal section. The ones I have seen show the RCW # which is what code they are using by law to sell or auction the property.

Ours was a foreclosure, too, but built recently and not trashed inside.

Management company cleaned out the trash, repainted, etc. prior to the purchase.

It was a bargain but not a steal.

yeah well, I didn't like that it was a ****-hole, but I was married to a douche bag at the time.

It's great now. Paid off in full, and fixed up as we went along.

Wouldn't do it again, but, no regrets.

Nowadays, I think it would be easier to find a nice foreclosure.

Hey drewdad, did you read in the statesman on sunday about the housing glut in las vegas?

all these super fancy houses the owners sell after 4 years because they're not "new" anymore.

Just wouldn't do for the Joneses to see you in a house that didn't have the latest.

I swear to God, the realtor was pointing out the tile in the foyer in this one stupendous house, saying this was going to be one of the things that was going to make the house harder to sell.

It was because they were something like 16 x 16 inch tiles, and now it won't do unless you have 24 x 24.

bookmarking.

was just thinking about buying a foreclosure home myself the other day!