How start wholesale process on a foreclosed or auctioned home?

Question

I think I have a good deal. House is for sale at auction for $125,000. It is a value based foreclosure auction. And comps in the area are $279,000-$308,000. Do I have a good deal and should I move on it.

Steve Smithy · Answer

Well you wholesale a property after you own it, just finding a property listed at auction isn't any kind of value to an investor!  As for if you should buy it or not, is that the starting price for the auction?  You should at least try to drive by and peek into it if you can (if vacant anyway).  Get more info before jumping in!

Barry Pekin · Answer

@Teresa Alvarez,

First, I have to agree about auctions.  Unless you are an investor looking to actually purchase a property, you don't want to be there.  If you're going to purchase it, then you have to look deeper into the numbers.

Determine your own ARV or get someone experienced to do that for you.  Then you need an estimate for the repairs that need to be made.  This number is missing from your post.  The house could have fire damage and is completely gutted, or it just needs some paint (the extremes).  The condition of the house makes a huge deal because you need to know how much more money (and time!) you need to spend on the house after your purchase it.

But, go to the auction.  Meet the investors who are buying the house(s).  Network.  Ask what they're looking for and if they would be interested in you bringing them deals from time to time.  Yep... These are more of your cash buyers.  They're everywhere!

Jerryll Noorden · Answer

Honestly.. I wouldn't bother with auctioned homes. It really is a hit or miss.

I rather not play Russian roulette with so much at stake.

The fine print here is that I know NOTHING about auctions and who knows I am way off here.. so wait for others to chime in.

However unless you buy that auctioned home I truly don't see a way you can wholesale a house up for auction.

Then lastly.. as a general tip on wholesaling... don';t do the shortcuts.

Don't go for MLS, don't go for joint ventures,

just do it the "hard" way and find off market properties and get them under contract.

Get a website. Make it credible. Get a logo, print said logo on your shirt. put it on your website. Look and act like a real business not as an individual, trying something out.. because without a real business front.. that is exactly what you look like... an individual trying something out. You do not want that.

Most people persuing shortcuts will for ever persue shortcuts.

When I started this adventure a ton of other people also started at the same time.. they are staling the MLS ... because that was the "easy" way.  Too lazy to get a site, too lazy to do actual work, too lazy to find real deals.. and I see them still hustling stalking the MLS and other shortcuts trying to make it.

Wanting this bad is not enough. Guns N Roses also tried wholesaling, but they couldn't cut it so they just wrote a song about it.  Not many people know this. https://www.youtube.com/watch?v=o1tj2zJ2Wvg

Axl, if you ever read this.. you are welcome!

How start wholesale process on a foreclosed or auctioned home?

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