First Deal: Process of Purchasing a Pre-Foreclosure
Hello all!
I'm trying to get my first deal under my belt via a live-in-flip in Jacksonville, FL. I've done TONS of reading on BP, the internet, and books, and I believe I'm ready to take the plunge. I have been scouring Zillow and Realtor.com, and I've been working with an agent with access to the MLS to find my first deal. I've found a (possible) deal that is currently in pre-foreclosure.
After some internet searching, I've determined that a Lis Pendens has been filed so it is early in the foreclosure process (per this thread: question-about-the-foreclosure-process-in-fl). From the reading I've done here on BP, I understand that I could make an offer for the pay-off amount to "save" the Owner from being foreclosed on. I'm interested in doing this, but there is currently not an attorney listed for the Owner so I will need to try and contact them directly.
I have a few questions for you experienced investors out there:
1. What is the best way to go about dealing with pre-foreclosures and Owners that are being foreclosed on? Should I mail a hand-written letter explaining that I'm interested in the property, or is there a better (more efficient or effective) means?
2. Once I've established contact with the Owner, he/she is interested in selling, and I've done a walk-through and am still interested, would the next step be to request the pay-off amount be provided by the Owner from the lien-holder?
3. After further analyzing the deal and I'm ready to make an offer, could I make an offer contingent on a home inspection (which would verify if my deal is still worthy or if I should modify my offer)? Would I need to or should I open an escrow account before or after submitting an offer?
4. How does a bank analyze the value of a property in order to provide financing for such a deal? Must it be appraised (or just inspected) before issuing a loan?
Are there any steps in this process that I've missed? Any other issues or concerns to which I should give consideration?
Any help or education is sincerely appreciated!
Kind Regards,
Jacob Wadkins