Investing in Foreclosed/Pre-Forclosed vs. Unlisted Properties

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What is the difference/benefit between investing in properties that are listed in foreclosed/pre-foreclosed phase, vs investing in properties that are not listed on the MLS?

Keeping your hair versus losing your hair?

The low hanging fruit is gone. Properties flagged with foreclosure issues now are not the deals of yesteryear and the benefit of trying to purchase these are not nearly as good as they were. Values have come up in most MSA locations so, the bid amounts at sale are going to be much higher than they were. Back in the day (Not long ago) we lenders used to open our bids at foreclosure auction day just a bit lower than the fair market value, to entice 3rd party bidders. We thought anything over our bid was better than taking it back, rehabbing and then selling it because we thought prices might continue to go down. Now, we open our bid either at totla debt or very very close to fair market value because time is on our side. Values will go up over the passage time.

So...to your question, big differences between the two scenarios however, not so much of a big incentive any longer to buy foreclosures versus open market transactions on MLS.