I got started when a foreclosure notice got taped to the house next door. We live in a
historic neighborhood, row homes only feet from each other...so the notice was hard to miss. Hadn't know the couple next door very well, but had been over a few times to know the house was really great, just needed a good cleaning and some fresh paint and carpet. The couple divorced, both moved out and couldn't agree on accepting the offers that came in...and ended up getting foreclosed on instead. Oooof. But I digress.
Because I was friendly with the local real estate agent, (he was my agent when I bought in the neighborhood) I knew there had been several offers in the $279K range. I researched the local foreclosure auction process, borrowed money from family, and quite happily bid up to my limit of $199K...(my best homework at the time, I thought that gave me a great margin and enough room to cope with any potential hidden issues). I was aggravated beyond belief when some guy in a suit outbid me. Jerk.
I was crushed, but hung around to speak to the winning bidder. After all, he might be my new next door neighbor! Turns out he was the attorney for the foreclosing bank. We chatted, and he offered to "assign the winning bid" to me at my last offer of $199 (he won at $204). We came to agreement quickly and it was mine for $199. This bit, I truly don't get and would appreciate the help of vets out there - is the bank attorney mostly looking to cover their outstanding principle on the foreclosed loan? Seems in my state almost all foreclosure auctions are won by the bank attorneys?
So bottom line, paid $199K, spent $5K on some minor fix ups, ended up it sold it for $299K. Hooked! This was in 2007 though, the house today has probably dropped to $250K or so in value. Only 2 awkward over the fence chats about home values with the nice people who bought it from me.