Buying at Sheriffs Auction-need quick help - Posted by Brian, WI

Posted by Woody (MI) on February 24, 2002 at 05:07:50:

As a fan of your posts I would like to say it’s great to have you back. I just love reading your answers as they always show a great deal of thought and creativity. I guess I just wanted you to know that I, and I am sure many others, have missed you.


Buying at Sheriffs Auction-need quick help - Posted by Brian, WI

Posted by Brian, WI on February 19, 2002 at 16:00:33:


There is a house to go for sale at the court house on March 4th, 2002. Although I’ve not been in this house(3 bd 1 bth) ranch, I’m a police officer and other officers have because it is vacant and neighbor kids have been found inside. Those officers state some simple painting and carpet would make this good to go.

Anyway, I have money and am thinking about going to the auction and try to buy this one. Question is, should I?

Being new to this(I’ll be going to the convention though), I don’t know if the risk is worth the reward.

Just pulling numbers from a hat on this one: suppose I can buy at auction for about $60K, put about 3K into it, it can easily sell for $90K without having to “dicker” on the price.

Your thoughts, concerns?


Brian, Wi

Re: Buying at Sheriffs Auction - Posted by JT-IN

Posted by JT-IN on February 19, 2002 at 18:43:31:


Essentially, how you describe this deal, is exactly how it works… that is what I do everyday; buy at wholesale, sell at retail.

However, as you yourself have mentioned, “being new to this”, your assessment of value and costs to repair may not be exactly right on the button. Since you have sufficient time here, you may want to do all the things that David K mentions, as well as having a property inpector check out the place. They will be able to spot any real problems, and even help you with cost estimates of repairs. Even if you are right on the money with your estimates of repair costs, the inspection would serve as a validation of what you now think, and that too would hold some value for a new investor. However, as David K also mentioned, it is easy to underestimate what things cost, etc. And the 3 to 4K is too low for paint and carpet, even if you do it yourself. You will find that your fellow police officers are better officers than RE investors, because they are probably not even close… but that is a distant observation, and somewhat facetious comment, meant to be humerous.

Be certain that you are not making any legal mistakes, such as buying with an unserved lien in place. Be certain to have the title searched before the auction; it will be money well spent. As you can see, you can start spending a tidy little sum on property that you do not even own, with these foreclosures. It all adds up!

You have the makings of a proftiable deal. Do your homework, (research legally and physically), know exactly what you will spend, tops, before the auction, and have a detailed plan of how you will exit the property. Hopefully, you will land on your feet with this one. Good luck.

Just the way that I view things…


Re: Buying at Sheriffs Auction-need quick help - Posted by David Krulac

Posted by David Krulac on February 19, 2002 at 16:32:17:


Foreclosure is not for novices. Call the sheriff and find out who the attorney is handling the foreclosure for the bank. Find out what is owed on the property, it could be more than $100,000. See if you can locate the owner, they could deed you the property before the sale and you could eliminate the competition IF the amount owed is less than the amount owed+ repairs+ selling costs+ your profit.

Repair costs can be higher than you think, interior paint could be $3-4k, carpet could be $4-5k. How are the mechanicals like heat, plumbing and electric? When a property is empty things dry out, rot, etc. Also could there be freeze damage if the heat hasn’t been on for a WI winter. how long has the place been empty.

It would be to your benefit to see the inside, and if you can’t find out from the attorney the debts, then a title search would be in order. If there is any equity expect competition at the sheriff sale. If there is no equity, then why are you interested?

David Krulac
central Pennsylvania

Re: Buying at Sheriffs Auction-need quick help - Posted by Scott

Posted by Scott on February 19, 2002 at 16:25:04:

If you’ve done your homework, I don’t know how you can go wrong if you go to the auction with a game plan (i.e., I won’t spend a dime over $x, no matter what). Going in, just make sure you know all the rules (how much down at the auction, what type of funds, etc.)

Re: Buying at Sheriffs Auction-need quick help - Posted by Stacie

Posted by Stacie on February 20, 2002 at 14:04:13:

Aloha, I am interested in real estate. At this point I am just trying to read and research as much as I can. If foreclosure is not for novices, what is? Where is the best place to start? I was thinking of finding motivated sellers that are selling at a great price, tying up the deal and then selling to an investor to make a few thousand. I don’t have a lot of money to tie up, but I do have a lot of time. I am a homemaker with a car at my disposal every day. I may as well do something with my time. Where should I be going for information?

Re: Buying at Sheriffs Auction-need quick help - Posted by Ronald * Starr(in No CA)

Posted by Ronald * Starr(in No CA) on February 20, 2002 at 21:13:36:


There are many places to start. I agree with David Krulac. Not foreclosures. Maybe wholesale flipping, which is what you are already describing. I’m not an expert on that area.

Another possibility is to get a job with some property management company and learn while you earn. Then, you can perhaps tie up properties with lease-options and manage them well. Or buy them with little or no money down and manage them.

Good Investing and Good Investigating**********Ron Starr***********

Re: Buying at Sheriffs Auction-need quick help - Posted by David Krulac

Posted by David Krulac on February 20, 2002 at 14:29:57:


I visited 3 of the HI islands last year very enjoyable., so Aloha to you.

There have been many posts here on beginning, notable ones by johnboy and ronald starr, search archives for their posts.

I think a person should start where their at looking for vacant, abandoned, unkempt houses around their own neighborhood to start. Call sale ads, rental ads, and get to knwo the market. What is fair market value for your area? When you look at a bunch of houses you will be an expertt in your backyard and will know what is a bargain. Seek out people who are really motivated to sell. Good Luck.

Your question could have been answered by a book, and that might be a place to start, buy some inexpensive book or go to the library to fill in the gaps in your knowledge base.

David Krulac