Originally posted by @Andrew Melvil:
@Lori Greene thank you, Lori! Definitely I will visit county and I will use the web site!
Great Andrey. Also, here are more tips for finding pre-foreclosures, motivated sellers and distressed properties that may not be on a list that everyone else has:
* Create a Huge Birddog Team: Train everyone you know and meet how to spot a distressed or vacant property (ask me if you need tips on how to spot a distressed or vacant property). Tell them all that you'll give them $100 if you buy a property that they referred. Tell them to tell their friends too. Delivery workers, property workers, landscapers, contractors, your mailman, your garbage man, your meter readers, etc., are great for this because they are driving neighborhoods everyday anyway. Also drive around yourself looking for distressed, vacant, for-sale-by-owner and for rent.
* Put out ads, signs and mailers to attract motivated sellers and pre-foreclosures (get Notice of Default list at county, A.K.A. Lis Pendens or Sheriff's Sale, Tax Sale, etc.).
* Call, text or email for-sale-by-owners and rental properties on Craigslist and Zillow (this sometimes works better than a phone call).
* Get a realtor to put you on daily auto-emails of properties listed at Price/sq ft 70% or less than area average price/sq ft and/or with motivated sellers keywords like motivated, TLC, invest, potential, opportunity, bring all offers, short sale, as-is, seller financing, owner carry, desperate, must sell, fixer upper, handyman, rehab, repairs, problems, issues, foreclosure, REO, bank owned, distressed, probate, death, estate, etc.
* REO lists (BP has one, HUD has one). Bank-owned properties can be wholesaled using disposable LLC's where you create LLC's for the purpose of making offers, when offer is accepted, you sell the LLC to another investor so they now own the contract. Banks often demand proof of funds. Transactional Funding letter can be used for proof-of-funds. Ask me if you need more details about these strategies.
* Narrow down these many potential deals with a quick elimination process: Find the initial estimated ARV online by averaging all of the instant home value estimators like Zillow (confirm this later with the actual ARV from realtor comps). Find mortgage balance by asking the seller if possible (usually they will tell you if they are highly motivated). This tells you how much bargaining room they have. Confirm later with county records (deeds/liens) or do this now if you can't talk to the seller yet. Figure $20/sq ft for typical cosmetic rehab (confirm later with homeadvisor.com estimates). Now use the 70% rule: If the asking price and/or balance owed plus the renovation costs is 70% or less than the ARV, add this deal to your favorites list.
* Narrow your favorites with further due diligence: Get comps from a realtor, interview the seller to find motivations and needs, go see the property, get repair estimates from homeadvisor.com, look up liens/deeds, title issues, code violations, zoning issues, etc. at the county.
* Continue to narrow your favorites by the info you find. The best deals will reveal themselves with this process.
* Choose your most favorite.
* Get an inspection done to reveal all repairs.
* If you are flipping or buying yourself to hold and rent, present your deal and all of your fabulous homework to your lender. For funding you can try Private Money Partners (people with money who don't lend as a profession, our favorite, ask if you want to know how), Hard Money, Seller Financing, HELOC, Cash-Out Refi, 401K/IRA, Conventional Loan, Multiple High Limit Credit Cards.
* If bird-dogging, present it to another wholesaler or investor (give them all details except the address and seller name and contact info until you have a signed agreement with them).
* If wholesaling, make your offer. Once offer is accepted, present the deal to other investors in BP Market Place, at local REIA meet-ups, at local auctions and on your lists of Cash Buyers. For a great presentation, create a PDF with property details, photos, comps used to support your ARV, description of what needs to be done on rehab/repairs, numbers breakdown showing how you arrived at the profit number for the investor, etc. Then send the PDF to all of your investor contacts by email, BP direct message, in person or tell them about it by text or phone call if necessary.
