Came across an opportunity I was hoping to get some thoughts on...
I currently own one rental property in a condo complex. I just learned there is another unit going up for auction in the same complex. This is in Cook County, IL and will be a live auction in downtown Chicago.
I don't have any experience with auctions and know they can be risky. However, because I own a unit in this complex I was able to get in touch with the association and learn there are people living there currently, and they are current with their assessments. While this may cause its own problems, it does give reason to believe the unit is in fairly good shape. Additionally, I completely rehabbed the other unit so I know what any potential repairs might cost me and can do most of it myself. I would get a loan from the family to purchase the property and then make a decision later whether to buy/hold or flip.
Based on all this, any advice? This would be my second rental unit and my first time buying a property solely for investment. Also, any idea what additional fees would be included? The auction company is The Judicial Sales Corporation - there is no mention of fees on their website but I am not sure. http://www.tjsc.com/
Their fee is usually paid out of the sale price, they have to mention any fees before/at auction. Sometimes there is an additional fee but it would be disclosed on the auction listing (in that big jumble of text they read at the start of the auction that nobody cares about).
The bank is going to bid at the auction as well, they usually bid what is owed on the property, but sometimes they have to wait for someone else to bid first to get it going. Sometimes the auctioneer has the bank figure and will just say it after a few bids. I try to determine how much the prior owner owes, as that is likely what the bank will foreclose/bid on.
Don't underestimate the potential damage to the unit. The tenant could decide to punch holes in every wall and break every item on the way out, and there is nothing you can do about it!
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