How to evaluatre sheriff sale deals

[Tomi Stoya]

Hello everyone,

I am new to real estate and I am interested in preforeclosures and sheriff sales. I have read several books on real estate that explain the basics, but neither going into much detail on sheriff sales in particular.

My biggest question is how do you evaluate each potential buy and how do you determine the max amount that you are willing to pay with site unseen? Do you still follow the normal rule 70% of ARV - repair costs? How do you estimate repair costs, given that you have not seen the house on the inside? How do you weed out the properties, where you are unlikely to get a deal? For example, is there a certain (judgement amount owed)/(ARV) % that you could use as a rule of thumb to decide whether to research a sheriff sale listing any further. As far as I understand, banks usually start the bidding at the judgement amount owed. Is there an ARV (absolute amount) under which any house is unlikely to be a good deal? For example if ARV is $80K and judgement amount owed is $40K, the listing may look like a good deal. However we are talking about a margin of only $40K here even though percentagewise it is impressive 50%. Price of building materials and labor is the same regardless of the ARV of the property.

Is it possible to talk to homeowner in preforeclosure stage to get access and inspect the property?

Could hard money lending potentially be an alternative to all cash buy in a sheriff sale transaction?

Are there any books or materials out there that specifically focus on buying properties in preforeclosure stage and sheriff sale?