Wholesaling Part Three: The Court Stenographer

Hello there.  If you're just reading my blog for the first time, go back to Part One & Part Two, as this is a blog about my journey as a novice wholesaler. I've been reading about wholesaling for the better part of a month, and I'm intrigued by the allure of it. It seems that anyone interested in breaking into real estate investing wants to begin with wholesaling.  Why is that? And why am I hopelessly seduced by the idea of it?  Five thousand dollars a month?  Twenty-thousand a month?  Sign me up, baby!  

Fact is, I'm realizing every day that it's much harder than I could have possibly imagined. How do I find my way to these cheap homes, after all?  What kind of a seller would give up a home for 70% below market value (is this even the correct percentage, by the way?) and how on earth would I discern a hopeless skeleton of a house from a diamond in the rough?  

I couldn't answer these questions a month ago, and I only understand a piece of it now, so for the time being I continue to hack my way through the learning process, a fascinating combination of incessant reading on the topic, endless drives around my neighborhood and beyond, and visits to the county records building. I visit the courthouse as often as I can get there, too, since houses are auctioned nearly every day at ten o'clock in the morning. Isn't that amazing? All I have to do is make sure that I haven't forgotten to put on a pair of shoes or to comb my hair before heading down to the courthouse to see what happens. And believe me, something interesting happens every time I show up.  

Like a few weeks ago, for instance. By now I've gone to three or four auctions, and while there seem to be a rotating list of auctioneers and attorneys, or an occasional investor, there is so far only one woman consistently there: the woman who represents the bank. I don't fully understand her job and the first time we spoke she wasn't very friendly, but she recognizes me now, and we sometimes exchange pleasantries. This was the same woman who started (and ended) the bidding at ten dollars in the story from my last blog post. In the three or four times I've been to the courthouse, by the way, this woman, this representative from the bank, is always the winner. Either investors aren't there to bid against her, or if they are present, they aren't interested in the house of the day.  At any rate, the last time I went to an auction, something unusual happened. A doorway leading to the waiting area where we sat was slightly ajar. I leaned over to see why the door was slightly open, and I noticed that a small woman with dark hair had been listening to the auction. The bank representative noticed her too, and stood up to say hello after the auction came to a close and the attorneys had packed up their papers and left.  

"How are you doing, Maria," the bank representative asked.  

"Oh, fine," she answered.  "Same old, same old. You know."  

"Sure do," the bank lady said.  They talked about unimportant things for a moment -- the weather, a mutual acquaintance -- but then Maria, who I guess had been eavesdropping on a few auctions from her office behind the door, asked the bank representative, "Do you ever lose at the auction? Does anyone ever come and win out against the bank?"  

"Sure," the bank lady said, shrugging her shoulders.  "The bank only allows me to bid up to a certain number.  After that, it's anybody's game."  

From my place on the bench in front of the elevator, I craned my neck to listen in on this conversation. Who was this lady behind the crack in the door and what did she care, anyway?  

The bank representative and Maria went on for a few minutes more, and then the bank lady packed up her papers and left. Maria was about to close the door and get back to whatever work she was doing, but I jumped off my bench and practically tripped over my shoelaces trying to get to her. I didn't know who she was or what she could offer, but for some reason I had a hunch that she would be a good person to talk to. 

When you're trying to learn an entirely new field without any education or mentor, you have to fly by the seat of your pants and talk to people. You have to be friendly, fearless, and try not to look like a freak. This was an opportunity I wasn't going to miss, even if I looked like some kind of solicitous fool.  

"Hi," I began, coughing awkwardly.  "I'm -- my name is Amy."  

"Are you an investor?" Maria asked. I thought she looked suspicious, but it's possible that she was only vaguely interested.   

"Sort of," I said.  "I own two properties and I come to these auctions to see if I might find another.  But I'm not ready to buy a foreclosure."  

"I wish I were an investor," Maria said, and she sighed longingly. She leaned against the doorway by her desk.  

"Why aren't you?" I asked.  

"Because I'm just a court stenographer," she said.  "I do have a rental property, though.  I inherited it from my Dad. It's empty, though."  

Maria and I talked for a while about her issues with her father's rental, my children, her children, her divorce, and the state of the rental market. I can't tell you how we got to this place except to say that there is nothing I love more than to schmooze. I'm a writer first and a (potential) real estate investor second, and there's nothing I love more than getting closer to the human condition.  People are endlessly, unremittingly, fascinating.  

But here's the interesting part of the story. Maria and I talked for about a half-hour, and at some point she said she really had to get back to work.  "But you know," she added, lowering her voice to a near-conspiratorial whisper.  "If you really want to be an investor, you should listen in on some of the conferences that the judges conduct with people in pre-foreclosure.  I work those cases all the time."  

"How would I sit in on those conferences?" I asked.  "Are the public allowed in?"  

Maria shrugged.  "I don't know," she said.  "But you could ask."  Then Maria told me to take the elevator to the second floor to find out which judges held pre-foreclosure conferences and on what date they were held.  

I thanked Maria, followed her directions upstairs, and met with a clerk in the office of a local judge. It turned out that the transparency of pre-foreclosure conferences were up to the discretion of the judges.  

The clerk, Edward, gave me some numbers to call, which I did, as soon as I got back to the car.  I spoke with another clerk who said, incredibly, that yes, pre-foreclosure conferences were open to the public, and that I could sit in and listen if I wanted to.  She said that the main reason for these conferences were for the judge to try and help people figure out a way to defer the process of losing their home to foreclosure, and that about forty or so people attended these meetings bimonthly.    

That sounds like it could be a lead, doesn't it?  What do you think, dear readers?  Should I attend?  And do I tell the judge my reason for wanting to sit in on these conferences?  Do I go in there and start passing out my business card? Wait -- I don't even have a card! 

Thanks for reading.  And tune in next time for my upcoming blog post about a landlord who showed me a property he was selling and then somehow ended up in my backyard eating roasted chicken...