So, here is a “Starter Guide” on getting into the foreclosure game.
Websites to Know:
… or more accurately: http://www.mypalmbeachclerk.com/online_foreclosure_sales.aspx.
This is the Clerk of Palm Beach website and where the auctions are held. You must register and submit a deposit before bidding on any properties. Here you can view upcoming foreclosure sales and bid on live auctions.
** Click: Palm Beach Foreclosure Crash Course for the “Crash Course” PDF – it’s a great guide and intro!
I can’t stress this enough – DO YOUR RESEARCH!!
EasyTitleSearch.com offers quick and inexpensive title searches. I still recommend you have an attorney review. But this will help spot red flags. Or you can go straight to your attorney for a title search/review. They will look for liens and any issues that might arise should you “win” a property.
Weeding through the foreclosure auctions can be a bit time-consuming and tedious. PBCHomeAuctions.com offers an easier way to narrow in on upcoming auctions – and find past auctions. It is a membership website, but I found it to be a useful resource. (Anything like this is totally optional).
– Do your RESEARCH. See if the property is available to view before auction, talk to HOAs if you can about backed dues, order a title search, if you know someone in the neighborhood as if they know the backstory, check if the property has unpaid taxes, etc.
– Pay Attention. Who is foreclosing on the property? A 1st or 2nd mortgage? The HOA? If the judgment amount is for $28,000, you may not getting a $300,000 condo for that amount, you may be buying an HOA backed dues bill.
– Look at Comparables. Just as if you are buying a market value property, look at comps. Some properties may seem like a steal, until you look at the comps and realize the entire neighborhood has taken a hit and it’s on target with a market value property (only with more risk).
– Cash is King. When purchasing a foreclosure at auction, you will have to have cash (not financing). Once you are the highest bidder and the redemption period is over, you will be paying for the property you have won. So make sure you have the funds ready to go!
– When to Bid. Foreclosure sales are conducted online each day, Monday through Friday, at 10:00 a.m. Bidding begins at 9 a.m. No sales are conducted on legal holidays. The process is similar to eBay.
– Give Yourself Enough Time. Don’t wait until there are :05 seconds left and then click “Submit Bid.” You will be asked to check off a few questions and then type in your bid and confirm. You’ll want to make sure you leave enough time to complete the process before the auction ends.
Same headline, different topic. Give yourself enough time to vet potential properties. You don’t want to be excited over a property that goes to auction tomorrow. I recommend being 1-2 weeks out.
– Cancellations. You may encounter cancellations. Sometimes they are permanent, sometimes you’ll see the property come back to auction a few weeks/months later. I always recommend saving all of your research so if a property comes back up for auction, you’ve already done all of your homework and are ready to bid (if you liked what you saw).
– You Can’t Win ‘Em All. The foreclosure auction game isn’t easy and can be competitive. Just know that you may have a Plantiff with a high max bid, you may have another investor you’re going head to head against, you may have a last second (literally) cancellation or you may find out that “perfect property at the perfect price” has a messy file and could mean trouble after auction. Keep your chin up and stick to your guns and you’ll find success in the auction world.
Buying a property at the foreclosure auction is possible. It’s not easy and it’s not for everyone, but it is possible. Just make sure you are doing your research and using vendors you can trust and rely on.