Things are starting to heat up in Phoenix, AZ. Bank owned properties are starting to receive multiple counter offers on properties. That means homes are being priced right so that buyers an investors are competing with one another. Then, the listing agent asks for highest and best offer to drive the price up more for the bank. I have seen prices go between 5-10% of the original listing price. I represent many investors who want deals. Well, that means I am forced to enter the trustee sales at the court house steps.
DEFINITON OF TRUSTEE SALE:
Trustee sales are advertised the day before. In Phoenix, we have three times when you can attend trustee sales. They require all cash and must close the next end of business day. This type of investing is not for first time investors. One must have a Network in place to be successful. The lender who is in first loan position starts the bidding at the amount of money owed to the bank being foreclosed on. Successful buyers receive the trustee's deed.
REQUIREMENTS
This is a public auction, and anybody may bid on the house to buy a house at a trustee sale one should know that:
- You must provide $10,000 certified funds prior to bidding.
- Must pay off the entire purchase price in full within 24 hours or by end of business next day
- Properties sold at the public auctions are sold without warranties. There is a possibility that the property may have liens and judgements tied to the property. One might have to evict the property owner or renter.
- 50% or more of the homes going to auction that day will cancel by the bank
BUYER BEWARE
The banks are selling these properties "AS-IS." They will not make any repairs. Hence, that is why you are receiving a deep discount. Here are things to be aware of when purchasing foreclosed homes
- All repairs must be fixed by the buyer
- All closing costs related to the purchased are paid by the buyer
- All cash or private money only
- Owners being foreclosed on sell the aplliances, kitchen cabinets, etc
- Odors are left behind from dead animals and/or rotten food
CONCLUSION
I have developed the Real Estate and Beyond Network to assist people in investing in real estate. Trustee Sales is not for novice investors. However, we have a system in place to identify, purchase, and either wholesale or retail the home in this current real estate market. How? We are trained licensed real estate professionals that does the due diligence on each property. We identify properties that are winners for that day. It is true that there is a group of people that control the court house steps. So, they represent us in the bidding process. Their fee is between $2-3K per transaction payable the next day at closing. This way you have one of the sharks on your side. It has been a great experience for many people. One must be patient and in position to pull the trigger when a great deal comes to use. Please feel free to visit www.DeliaTeam.com for futher information on this subject.
Make the Call, Set the Plan, Do the Deal$!
Feel free to listen to my Radio Show to learn more about the phoenix real estate market, new trends, and the latest opportunities. The Real Estate and Beyond Radio Show Airs every Saturday from Noon-2:00pm on Conservative Newstalk KKNT 960am in Phoenix, Arizona. You can listent to past shows, or stream on-line.
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Let's go shopping. Do they take Visa?
Great concept but not for me
Court house steps can be tricky for the first time. Need trusted advisors on your team
I am have had so many clients what to buy at the court house and over and over again I tell them Run do not walk ... not to the court house but away and straight into the best Realtors office you know
My clients usually want too many guarantees that they cannot get at the courthouse
One must have a solid team in place at the court house steps. I have establised Real Estate and Beyond Network for court house steps
I remember my first buy on the courthouse steps. What a mess. But I learned and lot, and my partners and I successfully bought many more after that first fiasco.
Great success to you Russel. It does work.
That's good news for Arizona... I had heard that was one of the hardest hit places.. :)
Hardest hit but we have 33K available homes on the market right now. We had 52K in January
Glad to hear that your inventory is being bought down. I have a client in Phoenix who needs to sell so that they can move back to Charlottesville. They bought their home for $895,000 two years ago and dropped the price last week to $495,000. I hope it sells before they have to go lower.
That is a price reduction. Thanks for the post
I agree with your comment that 50% never actually sell at the courthouse steps. The amount of taxpayers money wasted every day with the filings and all is staggering. I know for a fact that were I live most properties never actually sell back to the bank or to anyone else...it is just a tool to get people moving on paying their debt at the expense of the average taxpayer.
Mike McCann Broker
I agree with you Mike. thanks for sharing tonight
wow... this was interesting, Harry. Obviously, things are done differently in different states, as real estate law is state-driven. Here, in my part of WNC the deposit is MUCH lower and there's a longer period of time to close. But, ALL foreclosures here are either purchased by an individual or by the bank on the courthouse steps, and the owners of the property have 10 days after the sale to come up with the cash and buy the house themselves. (actually, anyone can make a higher "upset" bid and buy the property during that 10-day period). Most sales here are indeed purchased by the bank, because some of the issues you've mentioned. However, an investor who is serious can pay an attorney a nominal fee to do a title search prior to that sale, to be sure of that all-important issue.
Fundamentally, this type of purchase can yield great rewards, but is not for the faint of heart or unprepared!
Buying at the "court house steps" is not for the beginners, the risk adverse, or the financially challenged who cannot absorb a loss. This is a sophisticated, high risk arena.
Raymond-if one has a team in place-First time investors can plug into the Network.
Thanks for input Charlene-Interesting in your state
I think you have told it how it is. So many of my first time buyers with an FHA loan want one of these bargains. I explain it is not for them.
No FHA loans at court house steps. Investors sell court house homes to FHA loan candidates for a profit after repair. Great strategy
Investors don't pay too much for these houses from the lenders on the courthouse steps, they may submit a bid to the special master to submit to the lender - and even if the investors bid is not accepted I may offer serve to list and sell the house for the bank.
There are some aggressive Sellers in the banks who are willing to take the highest bid, and for the desirable houses the more bidders the higher price. Accept a Counter with a bare bones bottom price and potentially have a good amount of equity for the current shrewd Buyer.
Kent Davis
Harry- very informative. I liked the topic so much, I posted about it also. I, too, work the auctions as well as traditional real estate. There are bargains to be had at the auctions and there are pitfalls. Since it's not a traditional form of real estate buying and selling it's always nice to make sure one knows the benefits and caveats. Thanks for sparking the interest.
You basically have to pay cash at the time of purchase. Auction is at 11 am and you must have full payment by 2 pm that's the part that makes me nervous
Bring it on. I love the game.
It's not for the faint of heart.
I agree Lyn-
Hi Harry,
Big Question- After the courthouse sale is completed and and the investor owns it, what kind of title policy if any is provided?
If none is provided from the sale, can a clear title or a title policy be issued to the next buyer after the investor fixes up the home turns around and sells it?
Also, I understand that in order to sell to a FHA buyer, the investor has to wait 90 days from the date the property is recorded in the tax records from the courthouse sale. Is that correct? And if so, why?
I assume that is a nationwide rule?
I am in Nevada, so my market and rules I believe are similar to yours.
I appreciate your response.
Harry,
For all the craziness at courthouse steps, how much do you actually save?
MLS has lots of listings for 40K and up. Can the courthouse hassle really be worth it if
you are in the same price range on MLS?
is it true that the Irs lien only lasts for 90 days after you take posation, before it reverts to the original owner?