All Forum Posts by: Steve Babiak

When I buy at foreclosure sales, I typically approach the occupants and give them a chance to move on their own. Do you think getting an eviction added along with the bad credit report (they now have a foreclosure reported) is going to make it easier to find a place to rent?

If you're the only bidder, then the tax lien sale might be cheaper. But there could be "rights of redemption" beyond the sale date too.

Don't forget the possibility of bidding wars at an auction, and that there may be other liens such as IRS. At auction, you get to take care of those "other" liens, but under an agreement of sale, the seller can be given that obligation. And then you walk away with no loss if the seller is unable to cover them from the proceeds or other seller funds.

Last week I was at a sheriff sale. There was a bidding war on a property (with a house on it) with IRS lien over $1M. The bank set the opening bid well below the debt amount owed - I wonder why :)

So these auctions carry their own risk too.

Hey, Home Depot had a booth there too, and they had no such product. I will see if I can retrieve the info for you. Whichever of us gets the info first should post it back here.

Well, the tax assessor or tax claim dept should have a list of the properties that are behind on taxes. From that list, you find the ones that are vacant land. And you might be lucky enough to find an area where that info is online, making the search simpler.

A couple of years back I did a similar check for an area in PA known as the Poconos; plenty of land there that is behind on taxes. But then you have to ask yourself: Why aren't the taxes current? Can you correct the situation?

Vacant land produces no income; it simply drains funds to pay R.E. taxes. So people who at one point in the past thought they could build on the land come to realize that they no longer want to build; then they also realize they are being drained by the taxes.

That is both the opportunity (the owners become "don't wanters") and the challenge (how to get it to be income producing). If you can flip the land to somebody like my dentist (who owns vacant land that he happily drives his tractor on to cut the grass, hoping that some day somebody from NY will want to pay through the nose), you can get a quick profit. You just need to find that buyer first, or just use options that will allow you to get out.

And you can't forget about catching up the back taxes; you need to get the buy price low enough to cover those, and leave you a profit when the sell happens.

Loan mod or short sale attempts that start close in time to the foreclosure sale do not have enough time to complete before the property is foreclosed. Allow at least 4 weeks minimum - and then some - before the foreclosure sale if attempting loan mod or short sale.

As for the owner buying it back at the foreclosure sale: if they can't come up with cash for the amount of the arrearages, how do you expect them to come up with the cash for the full amount that they will end up bidding?

Sounds like you have been putting a lot of time in on this one, and it really has not proved to be worth it IMO.

One winter, I watched contractors remove vinyl siding and install stone face on a house. They set up tenting of a sort, with plastic, and they had heat within that area for just a few feet of space from the side of the house.

What they currently owe is not public knowledge; the public info is the original loan amount and terms.

Since you can find loan amount and terms, you could extrapolate an approximate remaining debt balance - but as you mentioned, the borrower could make extra principle payments, or have neg-am ARM, or pick-a-pay option ARM - all of which will affect the accuracy of your guess.

The 50% rule is another analysis, where the rent is divided by 2 to cover expenses, leaving one half the rent for loan principle and interest payment and cash flow or profit. Would need to have the interest rate to do that calculation; others on the BP site estimate that rate and then extrapolate the result based on that.

But a house that meets 2% rule is usually not a bad deal.

Why do you need his material to:
1. Find vacant land that is behind on taxes.
2. Get it under contract with the owner.
3. Find a Buyer.

And somewhere along the way, get the taxes caught up so it doesn't get taken out from under you.

I believe that to be the gist of this program. Is there anything there that you just can't figure out?

The listing agreement might say specifically what is expected to be done; it might say that the property will appear on the MLS.

Then there is something called "ethics", and duty to the seller client.

Is this a dual agency thing, where the listing agent is also acting as your buying agent? If so, then listing on the MLS might be a CYA for this agent.