Foreclosure Sales on The Steps of the Courthouse Worthwhile??? - Posted by Scott M. Brown

Posted by Warner(ATL) on June 12, 2000 at 06:55:14:


What I have observed, is that although it is true that tons of people show up at the courthouse to bid on properties (and yes many of them do not know what they are doing), there are very few investors bidding when one thing occurs…the bidding price is over 40-50K. In other words, when the bid price is 10-20 or even 30K everybody wants some action, but when the bid price is 70K and the house is worth 150K, even though it is a fantastic deal you’ll find one maybe two investors bidding. Most people, as Joe Kaiser says in his foreclosure course (highly recommended) just cannot come up with that king of money. These are the professionals the judge was talking about who make excellent livings off one or two deals a month.

Foreclosure Sales on The Steps of the Courthouse Worthwhile??? - Posted by Scott M. Brown

Posted by Scott M. Brown on June 11, 2000 at 09:49:04:

I have understood that there are very few deals to be had on the steps of the courthouse because if the house has little equity the bank will take it back at the sale. If on the other hand the house has lots of equity every idiot in the world will bid and the winner has the curse of having overpaid.

Recently, by circumstance, the judge (master of equity) who presides over each months sale took 45 minutes to explain the procedure in my state to me in his chambers. I expressed my reservations about the sale and he assured me that there are a very few professional real estate investors (that he obviously respects) who buy one or two properties each month. He was mostly concerned that I had money because he hates the broke Carleton Sheets type of seminar grads who want a $100,000.00 house no money down for free who flock in after an infomertial run.

My question is whether any of you know how these individuals might be overcoming the barriers to getting a good deal on the steps of the courthouse. I had not intended in getting involved on the steps of the courthouse but now with the encouragement of the judge my interest is high.

Re: Foreclosure Sales on The Steps of the Courthouse Worthwhile??? - Posted by Mark-GA

Posted by Mark-GA on June 12, 2000 at 12:14:30:

Another way some deals slip through is if you have knowledge about a property that other investors do not.

Last week, I bought a great house for $67k and was the only investor bidding on it. The area is full of so-so 3/1 houses. I managed to get inside and learned that this house was a 4/2 and that the hardwood floors beneath the carpet were spotless. It also has a brick fireplace not visible from the front. The house is on a great street and it shows well after less then $1k of prehab.

I expect to sell this week for around $90k.

In this case, I think my extra effort to get inside the house gave me information the other investors did not have.

Most of the auction regulars in my area go around and take pictures of the houses from the outside, run a few comps and leave it at that. They are left with the deals that everyone knows are deals. If you can get information they don’t have, you will have an edge.