I am planning to go and bid at the courthouse steps for a couple properties I am interested in. I have never done this before, previously I have bought regular short sale, foreclosure proeprties that have gone through a traditional closing process.
I wanted to get advice on some proper precautions to take. Meaning how do I know if the property has contractor liens, unpaid utilities or any other debt attached to the property?
Is there a service I can hire to tell me this type of information? So I can price this extra expenses into my bidding price.
Thanks in Advance.
I don't know about Georgia, but check to see if it's a Tax Lien state or Tax Deed state. In Texas, you can go to the county clerk's office and look up on their computers all liens that may be associated with a property.
You really need a title search which you can do at the courthouse.
But sometimes this is not that easy to do without help the first time.
Usually you will find someone there doing one for a lawyer or title company. Well worth it to offer $50.00 for a 1/2 hour of their time.
You need to check liens and any judgments against the owners.
@Steven Payne & @Ray H. - THANKS FOR YOUR ADVICE!
I'd attend a few up front and plan not to buy just to watch what's going on. Also, make sure you have cash(or equivalent) or the ability to get the money quickly. Most of these auctions will not be interested in a financial contingency.
Also about the search, in my area, you have to look at both the county courthouse and the county recorder's office(2 different websites) to get all the data about a house.
Call the auction company to ask them if it is bank or seller ordered
- Have your money ready
- Understand the terms,
- Is there a Buyers Premium, how much, who pays settlement cost, is it negotiable?
- Is there interest on the unpaid balance from the date of sale to settlement? (this could get expensive....especially if the settlement is delayed)
- When you are at the auction, stand parallel to the auctioneer so that you can see who is bidding on the property.
- At time unethically auctioneer will make up bids just to get the bidders to bid against themselves. (it happens!)
- Don't be shy about asking the auctioneer who the bidder is (they won't tell, but that is a warning to them that your know what's happening. It will slow down the process.
- Be it known that auctioneers know how to sell! You need to know how to buy.
- Don't get into a bidding war, don't go above your price, WALK --- there will be another auction tomorrow.
- Try to get immediate possession If the property is vacant - time to fix up and flip or rent
- Start settlement immediately, call your title company.
- Read the auction contract before bidding
- Understand all your charges
- Add in to your cost; commission, settlement cost (both sides), holding interest cost, title search and title insurance, insurance, repairs, taxes to be paid in advance.
- No sale? Great - go find the owner and negotiate a deal
- Foreclosure? No sale - great - find a decision make at the bank, talk to the trustee, find the owner (because if it is a foreclosure - the bank does not own it yet - they have to go through a ratification period, this could take months - time for you to negotiate with the seller, object to the foreclosure on technical mistakes and to negotiate with the lender for an assignment of the mortgage.)
This is a wonderful business, have fun, be kind to others - don't be greedy - there is lots of profits to be had for the prepared investor. Charles
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