All Forum Posts by: Account Closed

Sean Moen

Selling to them is pretty easy and can be profitable if you are able to find properties that they have not already scouted out.

Here in Chicago, the funds are paying at least 10% more than most retail buyers are willing to pay for move-in ready homes. For homes needing rehab, they are paying much more than any experienced local investors are willing to pay.

They pay cash and are usually able to close in 20 days or less. For most deals, the only person they send out to inspect the home is one of their real estate agents. Since these agents work solely on commission, they rarely find anything wrong and the deal usually goes smoothly.

The hard part is finding properties the funds have not already looked at. They are using several different methods in my area to find deals:

- They have teams of full time real estate agents who scour the MLS non stop. American Homes 4 Rent has even started their own real estate brokerage with 12 full-time agents.

- They have bidders at every county's Sherriff's auctions within 75 miles of the city of Chicago. They are bidding up to full retail price (or more) at the auctions.

- Some funds have started sending out yellow letters promising “No Low Ball Offers” to residents of their target neighborhoods.

Accordingly, it can be very tough to find deals that the funds have not already analyzed themselves.

I buy all my carpet at Menards. I have not found anyone in my area that can beat their prices on carpet. They have a good selection of Mohawk and Shaw brand carpets.

They usually have a few different colors on special at any given time. I buy pretty nice mid-grade frieze carpet for $0.60 to $1.00 per sq ft. They have lower grade berber for around $0.50 per sq ft.

They also have a large supply of "remnant" carpet in stock. These are usually 100 - 500 sq ft lots that are left over from the massive rolls they purchase. You can get some fantastic deals on the remnants if you only need a small amount. I have found very nice high grade frieze for under $0.50 per sq ft.

For smaller supplies that can be easily shipped, I can get better prices online. I buy all my plumbing fixtures, light fixtures, door knobs, cabinet hardware, small tile, etc. online. I have not found any store that can match ebay or amazon prices for items such as these.

If the condenser outside is newer and in decent shape, you should be able to patch in the missing copper line and salvage the unit. You will need to recharge the system with freon refrigerant.

Cost will depend on how much copper is missing, how much freon is needed to recharge the system, and what type of freon the unit requires. In my area, it would run between $250 - $1,000 for the HVAC work and another $200 - $500 to patch and paint the drywall.

Check to see if the A-Coil in the furnace is also missing. If it is missing, this will be another $300 - $500 repair.

Also, check if the condenser unit uses R22 or R410a freon. R22 freon has been phased out and new systems use R410a. R22 is becoming harder to find and more expensive as supplies deminish.

The funds buying at the foreclosure auctions in my area are making huge mistakes on a daily basis. In the past few months I have seen them:

- Purchase numerous second mortgages assuming they were first mortgages
- Purchase homes with several years of delinquent property taxes that have already been sold
- Purchase condos is developments that do not allow renting
- Pay over retail price for occupied homes where the former owners are refusing to leave
- Pay over retail price for homes that will clearly need extensive rehab

Some of these mistakes will result in $100,000+ losses per house when they sell the properties. It is normal make a few small mistakes when buying regularly at foreclosure auctions, but I have been shocked by the reckless purchasing of these funds.

I question if they are performing any sort of title search or even driving by the homes before bidding.

Here are some methods I have used to find and connect with the funds buying in my area, Chicago:

1. Search your County Recorder’s website to find properties they have recently purchased
- Do a “name” search of the funds you know are actively buying. You should be able to find the addresses or PIN numbers of the homes from the deeds.
- Some of the major funds buying right now include: Blackstone (aka THR, aka Invitation Homes), American Homes 4 Rent (AH4R), Colony Capital, Waypoint Capital, etc.

2. Use the MLS to find the buyer's agents (aka selling agents) they are using
- Once you have identified some of the homes they bought, use the MLS to find the closed listings. The name & contact info for the buyer’s agent should be there.

3. Go to your county’s Sheriff/Foreclosure auctions
- Funds are buying up everything at the Sheriff sales in my area. If someone there is buying an unusually large number of homes, they are likely bidding for one of the major funds.

4. Go to the fund’s website and look for a local office or phone number.
- Do a google search of the fund’s name. Some have websites setup where they list their rentals. They are also opening up local offices across the nation.

Here in the Chicagoland area funds have been buying pretty much anything under $250,000 in huge volume. They are buying: REOs, auction properties, short sales, estate sales, conventional sales, etc.

In Cook County the average time from when a lender files a foreclosure to when the property is auctioned at Sheriff sale is 682 days. I just purchased a home at the Sheriff sale where the lender filed the foreclosure in 2007. The case took five years to finally come to auction.

Try looking up the property, using the PIN number, on the Cook County Recorder of Deeds website: http://12.218.239.83/i2/default.aspx

The PIN number can be found on the Cook County Assessor's website: http://cookcountyassessor.com/

You should see a "Lis Pendens Foreclosure" file on the Recorder's site. Click on "View Image" and a copy of the foreclosure filing should pop up. Check who the attorney is who filed the foreclosure.

You can try calling the attorney to check on the case's status.

If the home has not been auctioned off yet, you can try buying it at the Sheriff Sale.

If it has already gone through Sheriff sale then either Pennymac or a third party now owns the home.

K. Marie Poe

Yes, I agree that serving the 90 day notice asap is a prudent measure.

I was just wondering if J Chen has had any contact with the tenant?

I would first go knock on the door and talk to the tenant about their situation before paying for legal counsel. There is always a chance that they will leave voluntarily.

J Chen
Have you tried offering cash for keys yet? It may turn out to be the easiest and cheapest option in this scenario.

The eviction process in Chicago can take six months or longer. It could end up costing thousands in legal fees.

I have had success getting tenants to leave by finding them another unit in the same development & paying for their moving costs (a few hundred dollars). They are usually willing to leave, but just don't want to go through the hassle of finding another place.

I would contact the tenant first and try to work something out before starting the eviction process.

Rick Harmon

The first mortgage was never subordinated to a junior position.

The first mortgage holder, US Bank, filed the original foreclosure.

The second mortgage holder, a local community bank, then took over the case in an attempt to foreclose on their second mortgage. Again, a subordination agreement was never recorded.

The case number was never changed. This makes it extremely difficult to spot that the second mortgage is the one actually being foreclosed on. You would have to spend hours searching through the actual courthouse file to spot this. No normal title search would spot this issue.

The fact that the loan number cited in the Judgment is wrong is definitely a major issue.

Item #6 in the Judgment for Foreclosure and Sale states, "The mortgage described in the complaint and hereby foreclosed appears of record in the Office of the Recorder of Deeds of COOK County, Illinois as Document No. 612450096"

This mortgage (Doc No. 612450096) is for a home in Streamwood, IL - COOK COUNTY (111 Mayfield Dr Streamwood, IL). This home in Streamwood was also foreclosed & sold at the COOK COUNTY Sheriff Sale on 10/7/2011.

This is extremely odd, being that your sale for took place in DuPage County, and all other language refers to the home in Glen Ellyn. I'm assuming this is a clerical error by whoever prepared the document.

A major error like having an incorrect document number, from a different county, in the Judgment should help you in getting the sale vacated.