Trying to buy off market house
Hello all,
I am very interested in an off market property. Needs work but good neighborhood, no tax lein and would be perfect for a house hack. I contacted the previous homeowners who advised me they don't have anything to do with the house (neighbors told me the house has been abandoned for at least ten years). I contacted the trustee lawyer I found listed and through my own lawyer sent them an offer which they say they received. I tried contacting again but his response was "since you've retained counsel I can only speak to your lawyer". I feel like I am going to drive by this house and see someone fixing it one day (this has happened to me before). Are there any other angles I can try? The taxes are being paid by a 'debt management company' who I have also tried to contact but can't get any information out of them. Taxes are current and up to date (verified by town tax assessor). My offer was a conventional mortgage with a 20% down payment (trying to reserve capital for the repairs the house will need). I have a hard time believing I am the first person to attempt to purchase this house, and I know there are plenty of investors/contractors in my area with cash. Wondering why it's been sitting/ what other strategies I can take to acquire it.
Any advice?
@Kristin Riker There could be numerous reasons this house is sitting vacant. I've attempted to buy properties just like this and from my experience it's a rabbit hole to near where. The description you provided feels like a reverse mortgage. If you don't know what those are I'd research it. My Dad's best friend lived off a reverse mortgage, passed away, and left nothing for his daughter. It's never a happy ending with these properties. Never any equity. No stepped up basis for taxes. It's an outdated practice (like Timeshares) that hopefully dies with our generation.
This property is a number on a computer screen. There's a property across the street from me in a similar situation. After 3 weeks of phone calls, emails, and discussing with the neighbor we figured out it's bank owned. Family is out of the picture. Unless you know someone, that knows someone, I'd guess 85% of these properties end up at auction. The auctions are dried up right now.
In the amount of time researching these properties you could be making competitive low offers on MLS, or good off market leads. That's where I'm spending 90% of my time given our market conditions.
@Jaron Walling From what I gathered from a few neighbors, it was a reverse mortgage and the owner passed and her kids inherited the house. I believe they began defaulting, hence the debt management company paying the taxes (plus the son telling me he had 'nothing to do with that house). I'm trying to buy one of these houses at ground level and seem I can't break the barrier to entry. I don't know if there are just too many people in my area with better contacts and more cash but seems like these houses get scooped up before a newbie like myself can even begin to get involved.
@Kristin Riker You are 100% correct and it's frustrating no doubt. I've gone after 2 properties like you described and hit road block after road block. It's mainly communication gaps. The people involved have nothing to gain by helping you. We personally knew the family on the first house. We helped clean out the property and the daughter gifted us some tools from the garage. It didn't matter. The father passed away (my Dads good friend), daughter lived in Florida, and she inherited nothing. She couldn't guide us because she signed paperwork removing her self from title.
Like mentioned already the second property is across my street. The balance on the reverse mortgage was $87k with a market value (at the time) at $120K. This is an outdated and distressed property that needs a $25K rehab, and a new garage since it's falling down. Add another $8-10k. Rents are $1k per market. The numbers didn't work.
@Jaron Walling I already sent an offer over to a lawyer I found listed as 'trustee'. I can have someone reputable run title for me for a small fee ($60, the county I am in makes running title a little difficult). Do you think its worth it just peace of mind knowing my offer at least went to the right place. At least they can tell me who is on the deed and potentially give me a new lead. A lot of detective work in this stuff.
@Kristin Riker Unless that lawyer stands to make money they have no obligation to help you. The detective work takes time. This is your biggest resource. I'd be making low offers on motivated, off market, or MLS opportunities. Way less effort and time.
I could be dead wrong and you'll land a home run deal, but I'm not betting on it.
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#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
- Investor
- Austin, TX
Get in touch with the owner. Skiptrace the name or knock on their door, lawyers are not going to make things any easier.
-House has been abandoned for ten plus years (spoke with three different neighbors )
-made contact with previous owner via letter and calling , he was estated the house and defaulted on reverse mortgage , states he has nothing to do with the home currently
-contacted tax assessor taxes are current and paid for by a debt management company I’ve contacted them they won’t give any information
-made offer through lawyer which was received but haven’t heard anything for about two months , when I follow up with lawyer he states I’ve retained counsel and can’t speak with me can only speak with my lawyer
my question is are there any other avenues I’m missing
@Kristin Riker Looks like you have exhausted all options.
Again the only people winning (trying) are the lawyers. Hopefully this isn't the only avenue you're focused on.