I am new to the forclosure side of the business and would like some thoughts on how to handle clients interested in buying forclosures, and also how to market to homes in default; such as door knocking. If you could give me some ideas and information on these two topics it would be greatly appreciated. Thank you!

I have a letter that I send out to pe-foreclosures.
I'd be happy to email to you.

Door knocking pre-foreclosures is tough. 1/2 the time, the people have already moved out, and the other 1/2 would just as soon shoot you as listen to you talk about them losing their house.

As far as representng buyers. It's much more time consuming than a regular transaction. You'll likely have to do it for less than your areas customary commission rate.

Hey DM_Realtor,

I was just curious to as where you go to get data? The local judicial paper here only tracks trustees sales.

Thanks,

DM

I just drive around decent neighborhoods and look for crappy houses. KIDDING.

Go to your county recorders web site and do a search for whatever they call the docs they send out to people who are about to be foreclosed on. In my area it's called an equity release notice. In yours it could be called Lis Pendens.

Thank you for the info, and yes please email me that, here is a scenario; **you get a 2 call from an ad from a buyers asking specificly for forclosures, 1 buyer says he/she wants to pick up a property for cash, buyer 2 has a full loan approval** Obviously one with cash has advantage,
-but what would you do next as an agent to fulfill these 2 clients wishes?
-does the financing make a huge difference?
-Where is the best places to find forclosure sales?
-I have access to the defaults, is it easier for you and your client to buy straight from the owner before it goes to forclosure?
-What agreements must be written up to ensure proper commission is due, maybe in the buyers broker? -please advise-

I just went to a seminar on foreclosure, it was a 10 hour seminar however it was an excellent, informative seminar. Go to their website www.YouDreamBig.com or give them a call at (888) 554-5563 and you will get all the information you need to approach the homeowner, contracts, letters, etc. I have started marketing in this market, by sending letters haven't had a response as of yet.

God Bless,

First, go to Arthur Marvin's seminars on foreclosure. He has two: Foreclosures and Advanced Foreclosures. He will teach you everything you need to know... Tips, secrets, avoiding trouble, etc.
Second, call a sales rep at a title company and request a (free) subscrption to notice of default lists.
Third, go through these lists, evaluate the homes on the list, and decide which side of the business you want.
Do you want to send your clients to these owners' doors, so that once your owner obtains the property you will list it for resale? Or do you want to contact the owners themselves? If you contact the owners, you will need to answer all of their questions honestly, such as "What is my home worth?" You can tell these owners...For example... Your home, if you could get it into shape, is worth $300,000. I have a buyer who will give you $125,000 for it like it is. That is $100,000 for the bank and $25,000 in your pocket to go rent an apartment and start a new life without a foreclosure. Or, I can help you get it into shape and list the home for you. But in today's market, homes take a good three months to sell, and the bank is ready to sell your home without giving you a dime for it in two months.

**That is not a script in the least; it just represents a possible scenario and you would fill in the blanks.**

If your investor clients are looking to get a hold of foreclosure properties to hold onto them, you will need to work out a buyer's agency agreement so that the buyers, rather than the distressed sellers, are paying your commission in this transaction. You cannot take a bird-dog fee. You need to take a commission per contract and do it all the right way.

The other thing you could do is watch for sales (again, that subscription your title company sends you will give you notices of sales) and tell your clients when to go down to bid at which sales. Or you could do it for them. You need a cashier's check good for the amount you are willing to bid up to at the sale.

And yes, it is a better situation to buy from the distressed homeowner soon before the sale. It is NOT EASY, but it works out better.

And no, don't write letters. Yours will be one of hundreds of pieces of mail being ignored. The foreclosure business is neither fun nor easy. Whether it is fruitlessly knocking on doors or fruitlessly showing up at postponed sale after postponed sale, it takes perserverance.
Good luck!
--A

Oh, and as far as a commission rate for the buyers... There are thousands of people who want to buy homes in foreclosure. You will do a LOT of work before you even get ONE for your clients. If you get them a home, charge them a full 3% on the sales price. You deserve it. That's my opinion based on the climate in Las Vegas.
Sure, if you turn around and list the home for them, absolutely I would say discount the commission. But not on the buyer's side in this particular case. Just my humble opinion.
--A

That's not too far off base. This time of year, people in my area drive around and look for high grass; a sure sign of an upcoming foreclosure. If it has already been to judicial sale, the asset companies have it mowed. Pre-foreclosures have high grass. Sounds crazy, but it's true.

Usually mailman and ups are "bird dogs" or "scouts" for properties and look for this kind of thing.

My experience is there are alot of dumass investors out there overpaying for properties.Which makes buying at the right price even harder because reo brokers,banks,and attorneys love sucker investors who overpay for the property.You have to compete with owner occupied buyers who just want 10 to 15k sweat equity which won't work for an investor to flip.

What we are doing now is setting up a foreclosure website and then we will get under contract and wholesale the deals to investors for a fee on the ones we don't rehab and retail ourselves.We will also hold some for lease options to challenged credit individuals for a big non-refundable option fee of course.

We have done the door knocking,and multiple other scenarios and found getting the deals pre-foreclosure is the best and also going after fsbo's who tend to way undervalue there property sometimes.

The thing about listing pre-foreclosures is it might sell or it might not but you will pick up buyers from the listin.If you want to list reo's after the sale with banks be ready to love property management and deal with lots and lots of forms(we aren't focusing on that end of it)

good luck

I few years ago I worked with a loyal buyer that had a restrictive budget/circumstances. After exhausting the market for some time, (rural area small towns) I decided to run an ad in the weekly paper that everyone gets free.
I advertised that a motivated buyer is looking for home in $xxx price range and could close asap. I got about 8 calls and listed 2 of the properties. They were both pre-foreclosures. I went through hell with one what to do but learned all about the Short sale process. that experience got me on a roll and now that is my niche. Find a reason to dabble in it first.

I cannot thank you all enough for sharing your fantastic ideas. I am new to this website and already think it is one of the best resources for agents of all statute. Thanks again

I know of a property that is going into to default. the situation is the tennants are are my future clients , and their landlord is missing payments, what options do they have as tennants, and how can i sell that home going into forclosure