How much legwork prior to bidding?
Submitted by Yuhan
from CA
- 08/16/2010 - 11:31pm
I'm curious how much research folks usually do before deciding to bid on a foreclosure auction property.
Do you:
1. run prelim title report or do similar research at county recorder
2. just trust foreclosureradar on title info
Do you:
1. talk to occupants to determine owner/renter status, amounts owed on senior liens, etc.
2. look up any remodeling/permits at the local city hall
3. drive by house and maybe attempt to walk around the exterior
4. just google the street view
Anything else?
My observation is that given the low percentage of houses that have NTS that are actually being auctioned off, you could spend a lot of time/effort/money on the above, researching houses have have NTS but may never actually get sold. Thoughts?
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Comments
Yikes - please never just trust us on title. If you haven't read our disclaimer yet please do. We only estimate loan positions, and we don't have data on involuntary liens (ie. IRS or judgements).
I think you'll find most pros either use the county recorder, or in SoCal, Property Insight for title research.
Also, make sure you add checking past due taxes to your list. You can do it online in most counties.
In your second list #3 is the most common, but the more you can do the better.
Finally you are dead on the money that figuring out which properties to research is the toughest part of this business right now. A number of strategies have been discussed in the forums including finding a niche and researching everything within it, last minute research on properties with opening bids, etc.
Thanks Sean. Yes, I've read the disclaimer. And so far I've been doing pretty much what you suggest, though I didn't know Property Insight was popular -- thanks for that tip... though, I just looked into it and they are kinda expensive! Do groups of investors share their service?
I've been focusing on a fairly small geographical area, and there's still a ton of NTS in there. After following for several months now, I've seen a handful of properties actually sold to 3rd, and a handful more go back to the bank... with no apparent rhyme or reason to it. As you and others have observed in these forums, I've seen entirely vacant properties get postponed multiple times! This is starting to look to me more like a full-time job, rather than a side-line "hobby", which is probably good for the rest of you full-timers. Maybe you should be thankful its such a frustrating/time-consuming endeavor. ;-)
Definitely important to have realistic expectations, though I'm certain not thankful that you finding it so frustrating. I do agree that buying at auction takes a lot of effort - what about partnering up with others?
Ask around at the auction - you may find someone who could use your help, even part-time, and be willing to split some deals with you so that you can put your capital to work.
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