Questions on how to contact the bank for a foreclosure

[Shenell Caldeira]

Aloha!

Does anyone know how we contact a bank for a foreclosure property?   Iʻm a new investor and donʻt know where to start.  

Mahalo!

[John Slater]

@Shenell Caldeira

Hi. Are you asking about a bank owned property, or a property currently in the foreclosure process. If the latter if very hard to speak to someone. The lender will only communicate about a specific loan with the borrower. Getting to an asset manager to buy a note is not impossible, but definitely not easy either.

[Shenell Caldeira]

@John Slater sorry a bank owned property.  Itʻs been sitting in foreclosure for a few years and I wanted to ask some questions about it and maybe put in an offer.  

[Eliott Elias]

Depending on if the property is bank owned or in pre foreclosure your point of contact will differ. You want to pick these up before they get into foreclosure. 

[Marty Boardman]

Quote from @Shenell Caldeira:

@John Slater sorry a bank owned property.  Itʻs been sitting in foreclosure for a few years and I wanted to ask some questions about it and maybe put in an offer.  

If the bank owns the house it's not in foreclosure anymore. It's an REO (real-estate owned). And if the lender foreclosed on the property a few years ago, but still hasn't tried to sell it, then it could be because there's an issue with title, or perhaps there's a legal battle taking place with the previous owner. The bottom line is you can't make a seller sell, even when it's a bank. Most banks want to dispose of non-performing assets quickly, and will do so by selling at a public online auction like Auction.com, or list the property with a local Realtor on the MLS.

Even if you can work your way up to the bank's decision-maker on this property, it's highly unlikely they will sell directly to you. They will want to expose the property to the entire market to get a highest and best price.

Rather than doing this I would focus your efforts on finding pre-foreclosure deals. This is a much more effective approach to finding below-market deals, especially as a new investor.

Good luck Shenell!

[Moe Khan]

Quote from @Marty Boardman:

Quote from @Shenell Caldeira:

@John Slater sorry a bank owned property.  Itʻs been sitting in foreclosure for a few years and I wanted to ask some questions about it and maybe put in an offer.  

If the bank owns the house it's not in foreclosure anymore. It's an REO (real-estate owned). And if the lender foreclosed on the property a few years ago, but still hasn't tried to sell it, then it could be because there's an issue with title, or perhaps there's a legal battle taking place with the previous owner. The bottom line is you can't make a seller sell, even when it's a bank. Most banks want to dispose of non-performing assets quickly, and will do so by selling at a public online auction like Auction.com, or list the property with a local Realtor on the MLS.

Even if you can work your way up to the bank's decision-maker on this property, it's highly unlikely they will sell directly to you. They will want to expose the property to the entire market to get a highest and best price.

Rather than doing this I would focus your efforts on finding pre-foreclosure deals. This is a much more effective approach to finding below-market deals, especially as a new investor.

Good luck Shenell!

 Good info. How does a new real estate investor find a pre-foreclosure deal? I am interested in Dallas/Fort Worth area.

[Patricia Steiner]

"Pre-foreclosure" is a term that is misunderstood often...it indicates that "lis pendens or notice of default is filed (consider it a lawsuit) until the property is sold."  This greatly discourages any transfer of title until litigation is resolved and most title companies will not issue clear title during this time as the title is in play.  

Also, please know that these will not necessarily be below market deals as the interest, penalties, and lawyer fees attached to these properties as a result of the default are significant. Can you give a lowball offer on these properties?  Yes, but don't bother. Those offers do not meet the investor parameters/guidelines that lenders must follow when a deficiency balance will be created.  

As a former senior banker, I don't recommend chasing these deals...you'll be wasting your time once Lis Pendens is filed. The days of getting a cheap deal from a foreclosure are long over. There are better avenues than this...

Best.

[Chris Seveney]

@Patricia Steiner

^^^^^ this right here

There will be people out there selling courses on this saying 2023 will be like 2008 and banks will be giving away homes. Furthest from the truth. We buy distressed debt and if we take a property back we will sell it but do not discount it we will list it for top dollar because we know there are buyers out there.

[Kenneth Garrett]

@Shenell Caldeira

I've had great success buying REO's directly from the banks. When banks finish the foreclosure process many times they just sit on them until there directed to move them. Don't waste your time with the large banks, you'll never get to the right person unless you operate a hedge fund and are going to buy hundreds at a time.

I found small local banks work the best. Credit unions as well. It’s all about small banks. They also like cash buyers, an easy way to move properties. It will take some effort. Here is the plus side, no competition for the most part. If you build a good relationship with the banker they will call you when there getting ready to acquire another property.

The two keys:

1. Have the money ready.

2. Be good at analyzing deals quickly, in other words know your market as an expert to determine what a good deal is. You can still negotiate with the bank based on repairs, mold, etc.

[Marty Boardman]

Quote from @Moe Khan:

Quote from @Marty Boardman:

Quote from @Shenell Caldeira:

@John Slater sorry a bank owned property.  Itʻs been sitting in foreclosure for a few years and I wanted to ask some questions about it and maybe put in an offer.  

If the bank owns the house it's not in foreclosure anymore. It's an REO (real-estate owned). And if the lender foreclosed on the property a few years ago, but still hasn't tried to sell it, then it could be because there's an issue with title, or perhaps there's a legal battle taking place with the previous owner. The bottom line is you can't make a seller sell, even when it's a bank. Most banks want to dispose of non-performing assets quickly, and will do so by selling at a public online auction like Auction.com, or list the property with a local Realtor on the MLS.

Even if you can work your way up to the bank's decision-maker on this property, it's highly unlikely they will sell directly to you. They will want to expose the property to the entire market to get a highest and best price.

Rather than doing this I would focus your efforts on finding pre-foreclosure deals. This is a much more effective approach to finding below-market deals, especially as a new investor.

Good luck Shenell!

 Good info. How does a new real estate investor find a pre-foreclosure deal? I am interested in Dallas/Fort Worth area.

 You search for notice of trustee's sales at the Dallas County courthouse. They publish these notices online. Here's the link: https://www.dallascounty.org/g...

[Marty Boardman]

Quote from @Chris Seveney:

@Patricia Steiner

^^^^^ this right here

There will be people out there selling courses on this saying 2023 will be like 2008 and banks will be giving away homes. Furthest from the truth. We buy distressed debt and if we take a property back we will sell it but do not discount it we will list it for top dollar because we know there are buyers out there.

I agree 2023 will be nothing like 2008. That said, there is plenty of data to support a surge in foreclosures this year. ATTOM Data Solutions just published this report that states "U.S. Foreclosure Completions Increase Annually by 64 Percent in November 2022" and that "foreclosure activity remains up 57% from last year". The highest rates were in Illinois, Delaware and New Jersey.

Link to article: https://www.attomdata.com/news...

You can make an argument that not many of these properties will end up in the hands of the bank as REOs. But there's still a huge opportunity here with the right strategy with pre-foreclosures and at the auction (sheriff's sale or trustee's sale).

[Chris Seveney]

@Marty Boardman

That statistic is so misleading because you were not allowed to foreclose the prior year in many locations.

That would be like lowering the drinking age to 18 and saying teenage drinking is up 80%.

Foreclosures are at all time lows and will continue to trend up. We have approx 500 notes in our portfolio and those that are distressed and legal had been started every single one has filed for bankruptcy. Why? Because they have a TON of equity and their mortgage is cheaper than rent and they have no alternatives

BK filings will be off the charts the next 2 years and foreclosures will increase but as noted calling a bank is a complete waste of time as they also use 3rd party asset management companies and will not give you time of day.

[Bruce Lynn]

Depends on who the bank is.  Chances are there is some problem they can't sell it if it has been sitting for years.

If it is a small lender, let's say like Bank of Hawaii.  You can probably hunt the asset manager down with a couple of phone calls.   Just start calling and asking who handles foreclosure or REOs.   Or maybe local lender.  Maybe local individual...you can track them down pretty easily.

If it is a big lender like the big banks....well good luck.  Not impossible, but normally they have their procedures and don't really want to take calls from random people.  When they're ready to list it they will.  You calling them typically does not wake them up and they can't really take a direct offer with you.

As others have mentioned we often use the word "foreclosure" very liberally to describe all types of assets.  Is it in pre-foreclosure...meaning probably some payments were missed, but they actually haven't taken ownership yet?   Have they taken ownership and now in lender's name?   If pre-foreclosure, there is some reason they can't take possession or haven't completed the process yet.  All kinds of reasons for that.  Maybe bankruptcy, maybe slow courts or laws over Covid, maybe owner missed a payment and started paying again, but one payment behind, maybe trying to do a workout, maybe some environmental hazard with the property that they want to take ownership of it.

So that would be the first step....find out who owns it.....individual or LLC or now in lender name. Then start skip tracing the responsible person.

Good luck.

[Olivia Grabka]

@Shenell Caldeira. Don't waste your time, bank will not speak with you; banks contract out all of their foreclosures with asset management companies. Me & my team worked with bank on short sales and REOs (bank owned properties).

[Clifton Willis]

@Olivia Grabka how did you meet your REO manager and build a relationship with them to we're they send you REOs and short sales?

[Shenell Caldeira]

@Marty Boardman Thank you for this information.  How would you find pre-foreclosure lists in my area?

[Joel Bongco]

Quote from @Shenell Caldeira:

@Marty Boardman Thank you for this information.  How would you find pre-foreclosure lists in my area?

 @Shenell Caldeira - Don't waste you time on REO's. The big island has a lot of preforeclosures, vacants, and land. We can talk live if you want more details. Mahalo! Joel

[Kearsten M Higgs]

Quote from @Marty Boardman:

Quote from @Moe Khan:

Quote from @Marty Boardman:

Quote from @Shenell Caldeira:

@John Slater sorry a bank owned property.  Itʻs been sitting in foreclosure for a few years and I wanted to ask some questions about it and maybe put in an offer.  

If the bank owns the house it's not in foreclosure anymore. It's an REO (real-estate owned). And if the lender foreclosed on the property a few years ago, but still hasn't tried to sell it, then it could be because there's an issue with title, or perhaps there's a legal battle taking place with the previous owner. The bottom line is you can't make a seller sell, even when it's a bank. Most banks want to dispose of non-performing assets quickly, and will do so by selling at a public online auction like Auction.com, or list the property with a local Realtor on the MLS.

Even if you can work your way up to the bank's decision-maker on this property, it's highly unlikely they will sell directly to you. They will want to expose the property to the entire market to get a highest and best price.

Rather than doing this I would focus your efforts on finding pre-foreclosure deals. This is a much more effective approach to finding below-market deals, especially as a new investor.

Good luck Shenell!

 Good info. How does a new real estate investor find a pre-foreclosure deal? I am interested in Dallas/Fort Worth area.

 You search for notice of trustee's sales at the Dallas County courthouse. They publish these notices online. Here's the link: https://www.dallascounty.org/g...

 Newbee here!

Would you mind spreading some light in the differences of obtaining properties of preforeclosure and trustee sales?

Having gone down to the recorders office to look at the NOD list that's really all I understand at all moment.

To be real, I don't quite know what the NOD list is other than a list of the pre foreclosure of a home.

Marty you've mentioned many times over reading through your posts that you tend to contact an owner within 30days of an auction on the home and I'm not sure how to find this information from my NOD list I've acquired. Calling the attorney involved sure, but that information isn't listed on the paperwork I am provided.

New to this space and I'm eager to learn. Still unaware of the correct questions I should be asking also.

Thank you for your time and for being a BP member, I'm really enjoying going through the forms here.

[Marty Boardman]

Quote from @Kearsten M Higgs:

Quote from @Marty Boardman:

Quote from @Moe Khan:

Quote from @Marty Boardman:

Quote from @Shenell Caldeira:

@John Slater sorry a bank owned property.  Itʻs been sitting in foreclosure for a few years and I wanted to ask some questions about it and maybe put in an offer.  

If the bank owns the house it's not in foreclosure anymore. It's an REO (real-estate owned). And if the lender foreclosed on the property a few years ago, but still hasn't tried to sell it, then it could be because there's an issue with title, or perhaps there's a legal battle taking place with the previous owner. The bottom line is you can't make a seller sell, even when it's a bank. Most banks want to dispose of non-performing assets quickly, and will do so by selling at a public online auction like Auction.com, or list the property with a local Realtor on the MLS.

Even if you can work your way up to the bank's decision-maker on this property, it's highly unlikely they will sell directly to you. They will want to expose the property to the entire market to get a highest and best price.

Rather than doing this I would focus your efforts on finding pre-foreclosure deals. This is a much more effective approach to finding below-market deals, especially as a new investor.

Good luck Shenell!

 Good info. How does a new real estate investor find a pre-foreclosure deal? I am interested in Dallas/Fort Worth area.

 You search for notice of trustee's sales at the Dallas County courthouse. They publish these notices online. Here's the link: https://www.dallascounty.org/g...

 Newbee here!

Would you mind spreading some light in the differences of obtaining properties of preforeclosure and trustee sales?

Having gone down to the recorders office to look at the NOD list that's really all I understand at all moment.

To be real, I don't quite know what the NOD list is other than a list of the pre foreclosure of a home.

Marty you've mentioned many times over reading through your posts that you tend to contact an owner within 30days of an auction on the home and I'm not sure how to find this information from my NOD list I've acquired. Calling the attorney involved sure, but that information isn't listed on the paperwork I am provided.

New to this space and I'm eager to learn. Still unaware of the correct questions I should be asking also.

Thank you for your time and for being a BP member, I'm really enjoying going through the forms here.

Go here and search "foreclosures" and then look for the NOTICE OF TRUSTEE'S SALE:

https://www.utahlegals.com/(S(qz3suyqbucrgtawc2hx2bhv4))/def...

[Ron S.]

Quote from @Shenell Caldeira:

Aloha!

Does anyone know how we contact a bank for a foreclosure property?   Iʻm a new investor and donʻt know where to start.  

Mahalo!