How To Buy Foreclosure Properties: Now Down To Work

You've read the announcement and it looks like it's the right kind of foreclosure property that you want to buy. If the date of the mortgage, date of auction, street address and whom to contact for the information is not listed in the notice contact the title company, courthouse or call the attorney and ask for it.

1. Now it's time to look at foreclosure properties you want to buy. You will have to determine the value of properties. Until you have enough experience to figure out the value hire an appraiser or a realtor. After determining it's value check the title to find out if there are any other liens against the foreclosure properties.

2. Contact the trustee for the up to that minute amount needed to buy foreclosure properties. Everyday that amount changes as charges mount until auction day.

3. Contact the bank for the exact loan balance and monthly payments, any charges or any problems they have with you taking over the foreclosure properties you want to buy.

4. Get a title report. Look at the title, check it's status, check the persons name on the title to see if there is anything that might cause a problem and read the fine print.

5. Contact the homeowner. The only way to buy properties before the foreclosure auction is for the homeowner to sign the deed. If the home owner is no longer in the property go to the Post Office and pay for a change of address update. If they ask why tell them the truth. Check with the neighbors and ask about the property. Check with the bank or trustee. Try directory assistance. Send the homeowner a letter at their old address telling them that you want to buy their home.

6. Have the homeowners sign a quit claim deed. You can get them at a title company or office supply store and have it notarized.

Once you have all the forms signed take them to the trustee with a cashiers check for the amounted need to buy the home.

How To Buy Foreclosure Properties: How To Value Properties

The biggest fear an investor has in foreclosure properties is the fear of paying to much for the house he want to buy.

1. Before you buy you need to know what similar properties have sold for. You can hire an appraiser, you can also have an FHA appraisal. Their appraisal will tell you what needs fixing in order to re-sell it FHA. Also have your realtor check it out as they can check what other properties in the area have sold for. After you have done this for a period of time you will get a better sense of what properties are worth. Write everything down in a pro/con type list to get a feel for foreclosure properties you want to buy.

Be careful using property tax records as they can be low. Looking at legal documents will tell you what the previous owner paid for the real estate but this, too, may be way off depending on market conditions.

You will need to determine the cost to fix up foreclosure properties to what ever shape you decided on. Sub-contractors can give you a bid on the work. Make sure that you can sell/rent foreclosure properties before purchasing it. Before you buy check with a realtor to determine what kind of market it is and how long from listing to sale.

How To Buy Foreclosure Properties: After The Papers Have Been Filed

So how do you find properties facing foreclose auctions??? Go to the County Clerks office and read the listings or depending on your area, there are publications you can subscribe to. You can also read about them in the local newspaper for your area.

Go to the County Clerks office and ask to see the recorded papers. The terms of the foreclosure sale will be recorded there.

The terms of the sale will tell you if your looking at a first mortgage or a second (home equity) and so on. You don't want to be bidding at foreclosure auctions for a $200,000 house for $25,000 only to discover that there's a $150,000 first mortgage that is also in default.

The obligation to determine the priority of the lien is yours. Go to the County Clerks office and conduct a title search. You can also hire someone to do the search for you for a minimal fee. They can usually be found through referrals at the County Clerks office.