I am a beginning wholesaler and was wanting to begin my marketing campaign to owners of pre-foreclosure properties. As I was doing my research on properties in my area I have found a common name in the trustee section of the properties info. I further researched the name and found that it was a law firm representing the homeowner throughout the foreclosure. I thought to myself if this law firm is getting all of these homeowners business, why not ask the law firm to provide me with leads? I would of course provide some type of payment to the firm. I was just wondering if anyone has experience with going to lawyers or firms that deal with foreclosure cases for their leads?
Sounds like you're seeing the trustee information. Trustees hold the deed on a property. They are responsible for actually conducting the foreclosure when someone goes into default. They aren't "working" with the owners, they are in the process of foreclosing on the owners.
Unlike mortgages, deeds are held in trust with a trustee. There is language in the trust documents that the trustee can put up a property for sale when the owner goes into default, which is between 90-120 days behind. How long it takes to get to the public sale depends on each state and their rules/regulations for foreclosures.
If you want to know about properties in default, you just have to watch for the public notices of default, which are published on websites and in newspapers by the trustees.
Aww I see. So who is in control of the property at that point? The trustee or would it still be the homeowner? I am wondering because if it is the homeowner, would it not be in our best interest, as the real estate investor, to provide solutions to that home owner? Also at this point, would the trustee be willing to provide us, the REI, with the home owners contact info or would that be against any identity protection services that the trustee may provide?
The homeowner is still the owner until the property is sold at auction.
They have a limited amount of time to cure the situation.
Two basic positions: they have equity and can sell their house as normal. Or, the mortgage is more than the value of the house and they'll have to get permission from their lender to sell short.
You can't really wholesale a shortsale. The lender will want it listed on the MLS to get maximum exposure. The other problem is that shortsales take a lot of work and there isn't enough time with a trust deed.
So, you're really looking for owners in default, with some equity, and still have enough time before the public auction to close.
Ok I see. Thanks for clearing things up Chris.
Trustees are too busy to do anything.
Maybe, over time, you can build a relationship with them.
Owner information is in the public record. There are lots of threads here on BP on how to obtain contact info.
First, tax assessor will have the names of the individual owners. Also, most county clerks these days have records online to search for mortgages and liens and judgements.
Once you have name and address, there are many tools online (free and paid services) to look up a phone number.
You also have to read up on the particular foreclosure rules for trust deeds of each state.
Some states like Texas, a house can be auctioned off within 3 weeks of public notice.
Other states give owners a slightly longer period of time to try and work something out.
If the owner has a mortgage instead of a trust deed, it goes through the judicial system and takes much longer to foreclose.
So, you have to understand the process and how much time you have to work with.