Comments on: Attended A Real Estate Auction

By: jim

jim — Mon, 02 Jul 2007 13:17:05 +0000

Nothing is ever as easy as it sounds or everyone would be doing it. I look forward to reading about it…

By: Khyron

Khyron — Mon, 02 Jul 2007 08:02:47 +0000

Pre-foreclosures aren’t as easy as they sound, mbhunter. Especially in Maryland. I can’t remember the full name of the law that went into effect last summer (IIRC) but basically, for operating in what previously may have been a not-illegal manner (yes, I mean not-illegal, although it may not have been ethical or specifically legal), you can receive 3 years and 10K per offense (IIRC). The pokey is right down MD 175 from Jim too. (At least one of them is.)

And be aware that Illinois has adopted a law similar to Maryland’s. An investor friend of mine told me that many banking laws originate in MD and move across the country. Not sure on the specifics as to why but…

It is fairly typical that you can’t inspect the house prior to the auction, making it an “as-is” sale. Don’t like it? Don’t do this kind of investing. Pretty simple. I can’t think of an auction I’ve seen that allowed inspection prior, except for that 8 unit apartment building I was looking at last year. But you were inspecting on the day of the auction.

Anyway Jim, I’ll be working on more RE posts in the near future. Just got back from out of town looking at some deals. Can’t say where yet, but there is a LOT of promise out there. I’ll probably do my first deal w/o my partners outside of MD.

By: mbhunter

mbhunter — Fri, 22 Jun 2007 06:22:14 +0000

30% off of market ($210k for $300k) isn’t bad but some investors I know catch pre-foreclosures for close to that. Why buy a property sight unseen with the previous owners still in the house when you can do just as well meeting with the owners and being able to look at the house quite a bit?

By: Lazy Man and Money

Lazy Man and Money — Thu, 21 Jun 2007 18:43:49 +0000

MDJ expressed my thoughts on the subject. I’d love to get a deal, but why not let you see what you’re getting ahead of time? The seller should put a lot of transparency in the process to get the most for his/her money.

By: broknowrchlatr

broknowrchlatr — Thu, 21 Jun 2007 14:50:37 +0000

I have been interested in this process also. I see tax sales in my area for 30%-40% off the appraised value. But then, you don’t know what the condition of it is in since you can’t go through it first and you have no idea whether the people will destroy thins on the way out. Then, you invariably have to fix a lot of things before reselling.

I always thought that it would be a good idea to call the people up that are losing the house and say you are interested in buying it from them. That way you can look through the house before hand.

In any case, its risky business.

By: MillionDollarJourney.com

MillionDollarJourney.com — Thu, 21 Jun 2007 13:59:23 +0000

I’ve purchased a house at auction before. Pretty interesting process. I was fortunate though in the fact that I could view the home before auction. Most foreclosure auctions around here, they won’t even allow you to enter the property b4 purchasing. Who in their right mind would purchase a property without entering it first?

Around here, they require 10% the same day of winning the auction, and 30 days to get the rest/financing. So far, it has worked out pretty good for me, where I purchased the home @ a 20% discount to market value.

By: jim

jim — Thu, 21 Jun 2007 13:50:08 +0000

If it required me to evict someone, no, but otherwise I see no problem with it. There are other and better ways to make a living though I don’t think badly of someone who is willing to or has to evict people (gotta pay to live there, you don’t pay, you don’t deserve to live there).

By: alex

alex — Thu, 21 Jun 2007 13:37:31 +0000

Sounds interesting. Would you ever buy a house (investment or personal) this way?