Hey guys, hope all is well with everyone. I've been investing for about 10 years now and I'm currently trying to get involved in Sheriff's sales. I live in Pennsylvania (Lehigh Valley) and am familiar with the Sheriff's sale process, but can't quite seem to figure out what I'm missing. I know I need 10% down in the form of a cashier's check; I know the properties to find are those where the first lienholder is bringing the judgement; I know changes can happen to the available properties up to the morning of the sale. What I don't know are a few very important pieces that are holding me back from purchasing.
Am I supposed to hire a title searcher to do a current owner search on 150 properties that may or may not even end up being offered in the sale? That would be 15K wasted without even a guarantee that I would even successfully bid on a property. That doesn't make much sense. I know a bit about the searching process but not enough to trust my judgement in what I find. I know I can call the attorney handling the sale of a specific property to get the upset price, but that info is typically only available the day before the sale, not leaving very much room to plan which ones my price range would allow be to target.
Really looking forward to any and all help that you guys may have to offer. If more specifics are needed to answer my questions, I am more than willing to supply them. Thanks in advance!
Of course not! If you are going to become an expert at real estate investing, and buy property at auction, you have to get good at title search yourself.
Title searching is not magic. Most of the title searchers who work for title companies are not highly paid employees... this is not rocket science.
When you become good at title searching yourself, this allows you to eliminate the vast majority of properties you might consider purchasing at auction. Once you hone in on a more selective set of properties you are considering, and especially if you are in a state where unrecorded or misrecorded property interests can potentially have priority over properly recorded instruments, it might be worth your while to order title search prior to the sale. This will allow you to argue in court that a reasonable person could not have known of the unrecorded lien and perhaps have the sale nullified on those grounds.
I consider myself to be highly skilled at title search. I am very computer savvy, and have spent a lot of time in recorder's offices in many different states. With that said, I recently began looking into investing in a new state, and ordered a title report to supplement research on a property I had already done. I did this A) to reinforce that I was correct in my assumptions and B) to provide a basis for legal action if unrecorded interests attempt to attack my sale. I also tend to be less comfortable with self conducted title searches in non Torrens title states.
1) Learn to search title yourself
2) Verify your title searches with title reports ordered for properties you know you will bid on
Also, if these are sheriff's sales, you will most likely have to learn how to navigate local court records.
Hello @Hal Thompson and thanks so much for your advice. I've frequented the records office quite often and was getting better, but there were ones that were so complicated that I doubted my ability and competence on all of them. I didn't want to cause myself an expensive mistake. Any courses you recommend or just figure it out as I go? One thing I didn't understand about your post: Verifying my title searches with title reports ordered. What did you mean by that? Do you mean narrow down and then hire a title searcher for the ones I want to bid on? If so, that's another frustrating thing. The title searchers I've contacted do not want to be rushed the day before the sale with 5-10 reports and the available properties change so much up until the sale, it might be a waste of money to order reports for properties that won't even be offered. I don't mean to be negative, I just want to really understand my course of action.
And thanks @Steve Babiak , much appreciated. I actually came across the links you posted earlier (that's why I requested you!) and read them all. I really want to understand these auctions/title searches fully. The MLS is so over-saturated with buyers I want to expand my opportunities. I've done public auctions successfully and I'm trying to figure out sheriff's sales. Any other avenues you recommend?
Thanks again guys!
What do you mean the mls is over saturated with buyer. Are you talking about investors or end buyers. Just curious. On a side note. I struggle with everything your talking about. A word of advice although it may of already been covered be careful and make sure you contact your water sewer and even electric utility. Some areas even allow the electric company to attach leads to a property. As you know outstanding debt isn't always reflected at the courthouse.
On a sidenote your area came in as one of the 10 best areas to flip and on some article I read. It also went on to say something like 6% of all probably sold had been flips. They suggested it is an overlooked market. It sounded very encouraging to me
Thanks @Robert LaBrie! As far as the MLS, I meant that when there is a good flip opportunity, all the investors of the area are bidding on it and pushing up the price. I still actively search and bid on MLS properties, but I want to get ahead of the game by expanding my opportunities on finding good deals. I've done well in this area and think I read the article you had mentioned.
In a nutshell, I've done this well for quite a while (not as seasoned as others, but always willing to learn more), but want to do this more full time and just need to find out how to get the inventory.
I hear you. Other things you may want to consider for finding properties include getting your realtor license. I will be getting mine shortly to improve my understanding of the market and looking at houses as a come online. Also allowing myself to write my own offers. I heard an interesting thing by an investor one day. By putting in a lot of offers even if you don't get them still get your name out there. So that when a broker sees a house come into their office they will be inclined to reach out to you because they know you're looking. There are a lot of guys out there talking about different campaigns for finding motivated sellers through marketing. Certainly bigger pockets podcasts have a lot of insight on how to do that. I'm just curious what kind of returns have you been getting on the houses off the MLS and are you doing the fixing up yourself
So, this is where having some technical savvy helps as well. I have computer programs I've written that automatically retrieve all the trustee's and sheriff's sale in my area, and i can then sort them by zip code, sale date, etc. I can then narrow in on areas and properties I'm interested in; that then becomes the basis for deeper title research. Most localities require some public advertising of a sheriff's sale, and so you can mine the newspaper's website or city clerk's data/recorder data (usually at least some of it is available on the internet for free) to narrow your search. Also, the more you understand about the state of the property you're considering (ie did the owner file bankruptcy the day before the sale, did
If you PM me I can help you look into doing something similar in PA. I don't have any interest in your market, but I'm always curious about the systems of other states. Sometimes the data you want is spread across 4 websites, but it's usually out there.
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