| In this article I will discuss a method that I personally | | | | There are many paid services such as RealtyTrac |
| use to find foreclosed properties. Not only it's free with | | | | that you can subscribe and get bank foreclosure |
| my method, but it will allow you to know about new | | | | listings online. The problems with these services are, |
| listings sooner and beat out other buyers on good | | | | they cost money and the data you receive are usually |
| deals. | | | | one or two months outdated. My personal experience |
| First of all, you need to find the right kind of foreclosure | | | | has been that when I call on many of the listings I |
| listings. Most guru would teach you in order to find the | | | | found on those subscription services, most of them |
| best foreclosure deals you need to hunt down the | | | | are already sold. |
| homeowners who are in the "pre-foreclosure" stage, | | | | So what's the best way to find foreclosure listings? |
| i.e. they are in default but not yet been foreclosed. The | | | | The answer is to go straight to the "source." You see, |
| idea is to pose yourself as someone who can "save" | | | | banks don't sell REO properties themselves. (Although |
| them from foreclosure by buying the house from them. | | | | banks have been attempting to get into real estate |
| The best way to get free pre-foreclosure listings is to | | | | industry, as of now they are still prohibited by law to |
| research Notice of Default records at your local | | | | get involved.) They list these properties with real |
| county courthouse. In fact, that's exactly how I got | | | | estate companies such as Re/Max or Century 21, etc. |
| started 15 years ago. That works fine until 2008 when | | | | When real estate companies receive the listings, they |
| the market changed and a new and better form of | | | | are required to post them in the Multiple Listing |
| foreclosure investing emerged. | | | | Services (MLS) - a huge database that contains all the |
| There are many problems with buying pre-foreclosure | | | | homes for sale by all the real estate companies in the |
| properties. First, the homeowners in default do NOT | | | | area. The MLS is the first place a foreclosure listing |
| want to be contacted. You will have a hard time | | | | would appear. From there it propagates to other public |
| getting them to talk to you. Second, you can't really | | | | web sites like or subscription services. The delay from |
| save their credit at this point. Their credit is shot | | | | is usually several days and you normally don't get all |
| regardless whether you prevented the foreclosure. | | | | the information (address, price, room sizes, etc.) |
| Third, even if you manage to persuade them to sell | | | | because it is intended to get you to call a real estate |
| you the house, chances are, they owe more than | | | | agent. The delay from subscription services is much |
| what the house is worth. Then you have to negotiate | | | | longer as I mentioned. |
| a "short sale" with the bank - ask the bank to take | | | | To get access to the MLS you must be a real estate |
| less than what's owed. I have done many short sale | | | | agent. All you have to do is contact a real estate |
| deals and believe me, it is much harder and more | | | | agent in your area and ask him/her to put you on |
| time-consuming than what the gurus who sell you | | | | automatic email alert. All MLS has a feature that allows |
| short-sale courses would have you believe. A short | | | | the agent to send you an email notification as soon as |
| sale from start to finish typically takes 2 to 3 months. | | | | a property that meets your search criteria becomes |
| Fourth, there may be other liens on the property that | | | | available or has a price change. This way you will |
| you have to deal with. A simple title search may not | | | | know about it before the information becomes public. |
| reveal all the liens. | | | | Most of MLS software will let you filter foreclosures |
| As I mentioned, since the financial crisis started in 2008 | | | | with a simple check box. |
| the real estate market has changed significantly. We | | | | Now if you are buying a foreclosed home for yourself |
| now have tons and tons of foreclosures all over the | | | | you should have no problem. If you are an investor, |
| places. If you are interested in investing in foreclosures | | | | however, you may find that most real estate agents |
| now, the best thing to do is to buy them from the | | | | don't like to work with investors. The best way to find |
| banks. These homes are also referred to as "REO" | | | | investor-friendly agents is through your local real estate |
| (stands for Real Estate Owned) properties. Why do it | | | | investor club. Simply do a search on Google for real |
| the hard way in buying pre-foreclosures while there | | | | estate investor associations in your area and you will |
| are so many bank foreclosed homes on the market? | | | | surely find one. There will be at least one or two |
| First, you don't have to talk to homeowners who really | | | | agents that market themselves to investors in the |
| don't want to talk to you. You won't be called a vulture, | | | | investor club. They will be happy to put you on the |
| either. Second, there is no "short sale" to deal with. | | | | email alert for foreclosure listings and eager to do |
| What was owed on the house is no longer relevant | | | | business with you. Since the agents' commissions are |
| after the foreclosure sale. The bank will just sell it for | | | | paid by the sellers, their service won't cost you a |
| whatever they can get. Their objective is to sell it fast | | | | penny. |
| and clear it out of their books. You will find that they | | | | So there you have it -- the best way to get free |
| would be willing to take much lower offers than regular | | | | foreclosure listings. Not only these listings will be fresh |
| homeowners would. Third, there won't be any title | | | | and up to date, but also contain all the information you |
| issues. Any liens would have been cleared through the | | | | need to do your homework. |
| foreclosure process. | | | | |