All Forum Posts by: David Dey

 Now that you can do with most banks in a reverse engineering way, but it will take much more elbow grease.  (Research wise)

This is a strategy that can be used to build ones own "pocket listings." 

As you may already know, the only way you can usually get an "unfair" advantage over your competition is if you have an agent feeding you pocket listings that he has kept for his special buyers. (I'm not saying this is ethical or even legal, I'm just saying it happens every day)

The issue with this situation is that no one realtor gets all the REO listings, (a safeguard the banks have put in place to stop these types of shinanigans) so most times you are forced to compete with everyone else for the deal once it's on the MLS.

The other issue is, of course, the agent will also have made their recommendation via BPO as to the amount that list price should be, so the bank will not initially accept much less than list price.

So the key is to get to the agent before they do their BPO.  This is where you're elbow grease will come into play.

1) Do a name search in the clerk of courts/register of deeds for deeds going to the bank of your choice within the last month.  Ex: Wells Fargo.

Obviously, banks are not in the habit of buying properties so you know that 99.9% of the time, a deed to the bank will be the final stage of a foreclosure, thus making that house an REO.

2) Now you realize that there is usually a 2-3 month window of time where the subject property you have chosen from your list of deeds is in limbo with the bank.  This is your time to strike.  

Call the bank and get to their REO Dept. As someone already mentioned in a post earlier, they will not sell it to you, but will refer you to the agent they have assigned it to. The cool thing is, if you have timed it right, you will now know who the agent is before the agent himself knows. This is how you are now able to influence the BPO and create for yourself your own pocket listing.

3)  Reach out to the realtor and inform him that he will be getting a listing on the subject property, and that you are willing to buy the property cash, using the realtor as both  the listing and selling agent, for a certain price.  (Don't be ridiculous about the price as there is only so far they can influence the BPO since the bank has probably ordered one before as well as getting the agents opinion)

4) Rinse and repeat.

 That is exactly what I was going to suggest.  If the other lot is a separate lot, then there is a chain of title for that lot as well that will pull up the owner of that lot, reach out to them as the owner of the property and offer them $500 to help you clear up a title issue. (In this case the title issue is that u don't own it) Don't make a big deal of it, as that may bring dollar signs to their eyes.  

If time is not an issue, then adverse possession would be an option, but I believe contacting the owner will be the quickest and cleanest option.  

Once you have resolved your situation, then see if you can pass on the cost to either the bank or the title insurance's O&E policy.

Hope this helps.

welcome to BP !  Any help you need, feel free to reach out.

ok, so I guess I was the second to step up to the plate. (Shows me for being so long winded) 🤓

ok, I guess I'm the first to step up to the plate.  Not sure about the big player moniker, but thank you for your kind words. :)

First, your decisions are going to be based on an additional number of variables including your job requirements, how much time you actually have to put into your pursuit, your personality profile, risk tolerance, etc.  

Make no mistake this is not a matter to take lightly, I'm not going to just give you the "just do it, rah-rah" pitch today.  (That's only on Fridays😜.. Today is thoughtful Thursday) 

One thought I wanna throw out there before going into the different scenarios is, that it all starts with your home.  (Or another way of putting it, first, make sure your own house is in order)

This has two parts to it:

1) when I first started this biz, it was 5 adults 3 dogs living in a motel room.  (Some may have read the story) I had received my Carlton sheets course and had devoured it because there was no other option.  

Still wearing diapers, (in terms of experience... Not literally)  I went fearlessly after my instinctive favorite type of deal, multi-family.  

I actually got several contracts on a number of properties ranging from 8-15 units.  I then went seeking financing from the only place I knew to look, hard money guys in the yellow papers and in the classifieds.  (Btw, Though I truly feel that carlton's course is one of the most comprehensive beginners course, he was still guilty of the gurus dirty little secret. "It's as simple as they say, just not as easy."  He taught me how to buy "no money down," he didn't teach me how to fund it.

I went to this particular lender pitching a 12 unit apt building, and he looked at me intently, sizing me up and down.  

"Son," he said.  "Do you own your own home?"

"No sir," I had to respond. (Still living in a motel)

"Why don't you start there first."

>Ouch< Not the answer I wanted to hear, but there was honesty in it.  And though I didn't get that deal funded with him... Or anyone for that matter.  But the happy ending is that a few years later, I did over a million dollars in business with him.

The second part is more directly to you.  My mentor said it best when he told me, "make sure in all of your deals and dealings, that if everything goes wrong, you still have a place to lay your head."

He explained that he was willing to risk almost anything in a deal, but his house.  He kept that separate so that if it all went bad, he would still have that.

Just a thought.

Now onto your scenarios.

1) I am a huge fan of 2-4 unit properties.  And I wouldn't be too concerned about your stature.  Some of the most intimidating people I know are 5 ft women.

2)  the purchase of a hud home, living in it till you sell it is probably the least risky strategy you have outlined.  It goes along the line of what I just mentioned, if it all goes wrong, you still have your place to lay your head.  The only issue is that it could become tedious having to move so frequently.

In all, this is probably my favorite scenario for you.  As that lender said regarding my own home, "why don't you start there."  

You can "practice" on your hud home at working with your contractor, buying your materials, etc. knowing that if it all goes wrong, it's still your place and will not just be a dead asset.

34567) all of these are sound options, You just need to determine what works best for your risk tolerance.  With the exception, I still believe that JVs, if with the right person can be the best way to jump through your learning curve.  

Ok, so I hope this helps.  If you need a sounding board, please feel free to PM and we'll talk.

@Steven Paul I personally am more of a building guy, though I will make a deal with what ever is at hand period.  I once was calling an owner of a duplex that I was trying to buy, she was not willing to sell but thought that I may own the lot next door and that she wanted to buy it.  (I use my neighbor elevator pitch when cold calling for properties)  anyway, as I was speaking to her I pulled up the lot next door and say that it had been bought tax deed by a self directed Ira for only 600-700 dollars.  I asked her what she would be willing to pay for the property and she told me "10k and not a dollar more!!" 

I told her I would be in touch about it in a couple of days.  

I immediately tracked the benificiary of the IRA to the other side of the state, reached out to him and offered him 1000 to sign over a quit claim deed to me. We settled at 1300. I sent him the funds and a deed to sign which he returned within the next couple days. Got back with the woman and sold it to her for the 10k.

Moral of the story is, if you can find an adequate exit, then lots, or for that matter, all kinds of property can be a good deal.

On a further tip note, check with the county for the "lands available" list.  This is the list that the county had sent to auction but no one bid on.  You will find many lots there.  Then reach out to neighbors and see if any of them might be interested for a small profit

Just a thought. :)

Raul

I have ranted on this issue on numerous occasions, so I'm not going into detail too deep except to say that this is an industry that really needs to go back to an apprentice/ tradesman scenario.  That being said, I am most definitely not talking about guru course sellers that take you on the rabbit hole of selling you a $99 mini course, then move you on to the $997 product, then invite you to a seminar where they pitch you with the 30-50k mentorship program. (Sounds familiar? It's called the funnel) 

This is not who i'm talking about, most "gurus" call center coaches that are actually not investors at all, but are regurgitating the course back to you along with some zig ziglar day planner directions for action and motivation.  (ok, maybe this is coming off a little too harsh, but I am trying to make a point here) 

There are some good ones out there, in fact, I heartily recommend @Brian Gibbons information and mentorship, as he is the real deal.  That being said, there is still no replacement for working under and shadowing a local SUCCESSFUL investor that is on the ground. 

Take a peek at the link below where I posted some actual advice on how you can find a local mentor and how to approach them.  I genuinely hope this helps.  

https://www.biggerpockets.com/forums/79/topics/273044-real-estate-investing-gone-bad-by-phil-pustejovsky

Hey Steven

Tax deeds can be a very lucrative area of real estate to deal in.  We took on over 200 tax deeds last year using a unique approach. 

What I assume you are looking to do is buy them at the auctions.  As such, the most important thing to do is research, research, research!!

Every month or so, the county provides a list of properties that will be selling in the coming month.  Most counties in FL are on realauction.com, Hillsborough isn't.  You will have to get it from their site at

http://www.hillsclerk.com/publicweb/td_sales_information.aspx

There are 2 things to realize is that if you are bidding at the sale:

1)  you will have competition.  Right now, with the market being quite hot, people are bidding premium prices, even on tax deeds.  So make sure you don't fall into the auction trap and find yourself bidding higher than you can justify through your research.

2)  Chances are there is a reason that the homeowner, and or lender has abandoned this property to the tax deed.  Many an unseasoned investor, (and some seasoned ones too) have found themselves caught in a trap with a property that has either physical, or title issues, that can not be resolved and leaves them holding the bag. 

I came across a deal recently on the open market that seemed like a goldmine on the surface.  It was being sold for almost 70k under tax value, in a great part of town.  It had been bought at tax sale, but the owner wasn't looking for more than a 5-10k profit from his purchase price. (and this was after doing a quiet title on the place) 

I spoke to him and was actually excited about this opportunity.  We scheduled a time to meet after the weekend, but I was so anxious I decided to head over and peek at it prior to the meeting.

When I got there, I was even more excited.  It looked great!!  And peeking through the front windows revealed that the living room and what I could see, needed very little work indeed. 

So to the back I went, and then deflated.  I now knew why the property was selling at such a steep discount.  The entire back half of the house was sagging,  the blocks had cracked as the foundation had given way and you could actually see the wall leaning out at almost a 30 degree angle.  I'm was surprised it was still standing.

No doubt this investor had done most of his research online, but there is only so much that google maps and Zillow can show you. 

I'm also currently selling a gas station, on the East coast of Florida, that a CA tax deed fund had bought without all the facts, and has ended up spending thousands and thousands of dollars in EPA issues for leaking gas tanks.  (That will put a bite into your profits)

Now I'm not trying to scare you away from investing in this very lucrative area of the industry, however, I want you to do your homework and not cut corners.  This is called investing for a reason.  You have to invest, not just money, but also your time and effort into making sure you actually have a good investment in the first place.

OK, enough of the soapbox speech.  Here's a quick proactive tidbit that can make you a truckload of money.

When you get the list of properties for the upcoming tax deed sale, there is nothing in the rule books that says that you can't track down the owner and buy the property before the sale date, thus saving yourself the issue of having to compete with the crazed masses. 

I usually pick up at least one or more properties before the sale each month, and at a very steep discount as well.

Hope this helps.

 The best deals I am generating are from people with problems!!

Remember this business, in its truest sense, is "professional problem solving." (Trademark pending😜)

The secret to getting a great deal is to position yourself in a place where you can consistently find people with issues that you are able to solve.  

Check your local public records for pre-foreclosures, bankruptcies, divorces, probates, code enforcement liens, etc.  All these can be a treasure trove of deals that you can turn into a truckload of equity.

Hope this helps.

@Brian Gibbons is being humble. If you wanna learn something, Brian's info is some of the best I've seen!!

@Nikki Grizzle and @Marcin Chojnacki make good points as well. Now here's my 2 cents.

I started out from below scratch. No money, no income, bad credit!! When I first started, I was one of 5 adults and 3 dogs living in one unit of a dive motel in Lakeland. Here is a link to a post where both Brian and I tell our personal stories on how we both started. Both are on the first page of this link.

https://www.biggerpockets.com/forums/12/topics/244...

(I personally think Brian's story is closer to how it should be done. You will see, in both instances, that there ended up being a mentor involved. This will come into my next statements momentarily)

I started with one of the best beginners courses that I still consider one of the best ever!! And the best part is that you can now get it for free!!

Carltonsheets.com offers you all those courses from way back when, for free... If you put your email address in. (I have a spam email address that I put into all squeeze pages that offer me something I'm interested in but don't want clogging up my main email) You will find one of the most comprehensive beginners course in those pages that are still relevant to this day.

That being said, had I not found a mentor, or more truly had a mentor not found me, I might not have made it to this point.

I have said it before and I'll say it again, this is truly one industry that needs to go back to the tradesman/apprentice scenario.

Most of the foolish beginner's pitfalls and potholes could be avoided by learning from someone who has already made those mistakes, learned from them, and moved on to success.

If you have spent any amount of time here on BP you will have come across numerous posts from investors who blast the novice entrepreneur for clogging up the market with bad deals, or more concerning to me, accidentally break the law and risk major issues. Well again, most of these issues would be resolved by working under a seasoned real estate professional that could teach them the ropes and could steer them along the straight and narrow.

My recommendation is for you to go ahead and get your license for the basic knowledge and the credentials to legally do your business, then find an investor that is buying for themselves and succeeding in this business and volunteer your services for strictly for the education.

For more of this soapbox speech and practical tips on how you can actually find that person, here is another link!!😜

https://www.biggerpockets.com/forums/12/topics/268212-still-havent-made-progress?page=1#p1754108

I do hope this helps!! :)