Buying a foreclosed property at a trustee's sale or auction can get you a really great deal, but there are a few things you need to know before you start buying up such property! It's not always the deal you imagine and you'll want to know a little something about the house or land before you invest in it.
Property sold via a trustee's sale/auction is sold as is. You pay for it, you get it, warts and all. For the majority of homes, this is fine and you will be getting a great deal on a piece of property, but not every foreclosed property is a deal. Foreclosure sales are usually by the bank or lender that the home owner couldn't pay.
When a home is on the market due to a foreclosure, it pays to keep very close tabs on the estates that you are interested in. The sales will often end up being postponed because the home owner is attempting to save their assets or due to processing times. It's easy to lose track of which property is still up for sale, but this can work to your advantage if you are meticulous about keeping records and making sure to track when each property you want is postponed and why. Others will either lose interest or not be able to track the property, meaning you'll have less competition when it comes time to bid. You can track a property via the Trustee Sale Number.
Once bidding opens up on a foreclosed property, you have a very good chance of seeing it go to sale. Trustees don't usually allow bids to be placed until they are certain that they are ready to sell. Bidding may open up anywhere from the day before to the time of the actual sale, making it very important to stay on top of things. You need to know the instant you can start bidding and keep an eye on other bidders.
Before you can bid in a Trustee auction, you have to "qualify". To qualify, you will need to show the auctioneer that you have the money to pay the bids you'll be making. This can be done with either cash or checks. In general, you'll want to bring several checks that are filled out in the Trustee's name, or cashier's checks that you can endorse over to the Trustee. If your checks exceed the amount you bid, you will be refunded the excess.
If you are the highest bidder, you can expect things to proceed fairly rapidly. You will be asked how the title will be held and will have to sign the check over to the Trustee. You will either receive a recorded deed at that time or it will be sent to you after the fact. The process usually takes less than a fortnight, making you the proud owner of a piece of property very quickly.
Buying a property at a trustee's sale or auction can be a good way to find cheap properties to invest in. Do your research and know what you are getting into and exactly how much a house is worth before you begin bidding and you'll be able to earn a good profit on the property.
