Upset sale vs Finding a rehab home

Upset sale vs Finding a rehab home

Jacksonville, FL · Member since 2015 · 13 posts · 1 vote
My goal is to rent out at least 2 homes in the upcoming year. I have been saving money and doing a lot of research through Bigger Pockets for some time now. It wasn't until just recently where I learned about Sheriff Sales and Upset Sales in my area. The Upset sale runs annually every September and after talking to my mothers landlord, surprisingly the majority of them attend these auctions! The homes can be dirt cheap ranging from less $1k to an average of $8k (the maximum I have seen is around $30k). You have to do your own title searches, etc. and you are unable to get an inspection before purchasing the home. The homes are old and not in the best condition. The amount of homes on this list are extensive and they have many homes in areas that I am very familiar with. After researching the BRRRR method (something that I would love to do in the future) and wanting to eventually build a portfolio. Would these Auctions be the best path for a newbie? I'm aware that the title search must be done correctly or I am in for a lot of trouble. Other than the title search, the cost to renovate the home may be pretty expensive as well. It seems as though many landlords do this in my area, but I wanted to get advice from someone who has had experience in this. There aren't many forums discussing Upset or Sheriff Sales. What is your take on this?
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Investor · Philadelphia, PA · Member since 2014 · 351 posts · 80 votes
9y

@Raylicia Y. I don't have any experience in Harrisburg, but in Philly, I have used the BRRRR method on sheriff sale properties. The most important thing to find out is if your title can be insured (Banks will want that before they would refi for you). In my case, I had to wait about a year before my title could be insured.

I hope this helps. Best of luck to you

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  • Investor · Philadelphia, PA · Member since 2014 · 351 posts · 80 votes
    9y

    @Raylicia Y. I don't have any experience in Harrisburg, but in Philly, I have used the BRRRR method on sheriff sale properties. The most important thing to find out is if your title can be insured (Banks will want that before they would refi for you). In my case, I had to wait about a year before my title could be insured.

    I hope this helps. Best of luck to you

  • Rental Property Investor · Mechanicsburg, PA · Member since 2016 · 19 posts · 4 votes
    9y

    @Raylicia Y. I have been looking into the upset sales in Cumberland County.  If you go to the Cumberland or Dauphin county websites there is quite a bit of information, but it sounds like you may have researched those sites already.  Here is a forum post with lots of info on foreclosure auctions.  After reading a bunch of the articles it sounds like they are more involved than I had originally thought, but I am sure that people get some good deals on these properties, otherwise no one would be at the auctions.  Bust of luck going forward!  If it's something you want to do, put in the research time and find someone you can talk to that has been successful doing what you want to do.  Maybe your mom's landlord could offer more advice and info.

    https://www.biggerpockets.com/forums/41/topics/689...

  • Jacksonville, FL · Member since 2015 · 13 posts · 1 vote
    9y
    Thank you both for your responses! Ryan Cameron Quick question, why did it take a year? Did they want to wait until the house was fixed up? John-Delfin Skovira Thank you so much for this thread full of information! I am going to be up all night reading this!! I have been searching through these forums looking for some info, I guess I should have stopped searching for Upset Sales (I wasn't finding anything)
  • Investor · Philadelphia, PA · Member since 2014 · 351 posts · 80 votes
    9y

    @Raylicia Y. No. The reason I was given was because it was a sheriff sale, they could not insure until after the redemption period (Usually a 9-12 month period when the owner of a property sold at sheriff auction could payback what was owed, plus interest, and reclaim the property)

  • Rental Property Investor · Mechanicsburg, PA · Member since 2016 · 19 posts · 4 votes
    9y

    @Raylicia Y. I think that "upset sales" and "judicial sales" are terms specific to PA. These would all be considered foreclosure auctions.

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