All Forum Posts by: Vic Iyer

Professional investor actively investing in the last 10 years in SFL. I primarily focus on SFH and TH. Active in Palmbeach and Broward. I have an Engineering background with MBA (Univ of Miami), Realtor license (for own use), and PMP certification. I have experience in Online auctions (HUBZU, AUcTION.com, XOME, CourtHouse foreclosure auction) and fixer-uppers, and foreclosure. Moved from Boca to Weston.

I am a professional investor with over 10 years of experience in Real estate investing. I can meet after 5PM weekdays and more flexibility during weekends

Not all auctions on auction.com are same.

1. What kind of deed are they offering? Quit claim or special warranty? If quitclaim simply runaway!

2. Depending upon the bank they might make you take care of code violations /ongoing litigations etc.

3. Who is living there? Previous owners? Tenants? Squstters? Need to set aside cash for key.

4. How is the outside condition?

5. Are there IRS liens? 

6. Hire your own title company and get title insurance. The title insurance they offer will have excpetions.

7. If single family home do a survey and check for boundary violations etc.

Unless you are getting a sizable discount this may not be worth the effort.

You should keep the commission to yourself. You earned it through your own license and therefore should be compensated. If it were 3% commission you could consider splitting the commission. You have to spend $$ to maintain your license and you spent time, $, and effort to earn your license. On top of it you are listing it for free. This is no brainer. In future if you want to avoid this get another realtor to handle the transaction. 

well, that needs to be legally disclosed. That changes the game plan.

I would suggest search for auction.com. I have posted many .

Auction.com is a reliable auction portal. I have bought properties through auction.com. I am talking specifically about Auction.com auctions of foreclosed properties. This is different from courthouse auction.

What to watch out?  

Make sure you are getting special warranty and not Quitclaim. If you don't know the difference between the two then you should spend time reading through different deeds.

Initial auction cycles have high reserve price and they are never met. After 6 to 8 weeks you will start seeing realistic reserve price. 

Most of the time they decalre the property as "Occupied". If they cut a "Cash for key deal" with occupants they will open it up for inside access. 

Auction.com will place bids against buyers. This is disclosed. They have 5% fee on top of your bid. Know your numbers before you place bid.

LAst but not the least, Use your own title company. This is very important. This will insure title/permit searches are done properly and updated prior to closing. You will have to pay your own title insurance when U use your own title company. Believe me it is worth it. When you deal with foreclosures have your own title company and safeguard your investment.

This is from a seasoned investor in SFL:

First and foremost, Deals do not fall on your lap. You need to go out and get them! 

It is true that market is tight in terms of getting deals. This is true in almost all the markets. Lot of competition among investors and conventional home buyers. But deals do come up if you eyeball the market properly. Margins have shrunk though. 

More and more investors are turning to courthouse foreclosure auction to mitigate the competition from mortgage buyers. This carries lots of risks and are not for a newbie investor. Be careful here!

As the foreclosures decline it would be even more challenging. 

If you are a newbie you should hold to your day time job and set aside real estate investing for the night. This way you will even have additional revenue stream coming while you stabilize your financial situation.

Reach out to wholesalers and get on their mailing list to look for deals. Again, not everything they have is a deal. You need to pick couple of markets and focus on them and slowly expand your wings to other markets.

Total baseless assumption. Banks are not giving reckelss mortgages in 2006(No income verification, upto 6 properties with no $ down, etc). The appraisal process has also become conservative. We are in a normal market with around 3% appreciation (in line with inflation) . 

Look here: 

https://www.biggerpockets.com/forums/79/topics/171...

Let me summarize the risks:

1. You don't have COMPS to ustify your potential sales price. Zillow, appriaser, Bank underwriters, and savvy buyers will undercut the sales price.

2. You are pumping in over $100K in renovation that a potential buyer may not even like. For a $380K purchase you should not be spending more than 10% of the sales price. 

3. I never estimate the sale price to be over 40% of my purchase price. There are isntances where a buyer may be willing but the appraiser who is under the watchful eyes of bank's underwriting will come up short and hurt you with you projected margin.