All Forum Posts by: Brian Erickson

 Since my first (and semi successful attempt) I haven't done a ton more.  My original criteria was fairly simple, there was an hyper-local area in which we eventually want a primary residence, so I had a quick glance online at houses for sale and ran across some pre-foreclosures.  Upon more 'amateur' digging I found the property could have substantial equity so I knocked there first.  But there are areas in which we want to eventually own rentals and we literally 'walk for dollars' and I will be knocking as we go next time.  I figure it's pretty much just like direct mail, except you're a direct person.  Not every house will actually have the criteria to make it a deal but you never know!  Plus you might learn more about the neighbors and the neighborhood.  I can't answer which questions are best since I've only done this a handful of times, but being organic as possible and creating a relationship seems to be the best approach for me so far.  

 We definitely thought about this as well but we have three little kiddos and didn't have any child care that day, so didn't want to stroll up with the whole family.  But in our marketing campaign we're taking the family business angle and giving potential clients the ability to deal with either myself or my wife, I'm hoping the option will appeal to both sexes.

You're good!  It's just outside of Seattle down near the airport.  

I posted here because it's the one subcategory that sort of made sense.  It's actually our current primary residence.

We're trying to force equity into the place the best that we can on a budget so we can leverage it to invest in more buy and hold properties.  The two main goals right now are to tenant-proof the main house the best we can (removing old carpet, replacing with laminate, removing the cracking kitchen tiles with the same laminate) and to try and take advantage of the weird situation that is 'the shop' out back.

It doesn't seem cost effective to try and plumb an extra bathroom or turn it into a self-sustainable MIL unit but maybe I'm wrong?  Even if you did, I wonder about egress and accessibility, since it's in the backyard

It's a water tight 800 sq ft.  We have three kids so building it out as a bare bones recreation room seems to make the most sense for us both currently living here and utilizing it as well as adding an additional 800 sq ft for the purpose of increasing value of the property.

My main question is, because it is not connected to the main house will the square footage count of the double wide count towards the overall total square footage of the property?  In the eyes of an appraiser would the finished 800 sq ft significantly increase the value of the property? Or does it not count because it's a separate room and/or non permitted structure (potentially)?

In order to safeguard yourself in wholesale transactions/assignments is it necessary to be a licensed agent working under a broker or must you be a licensed broker yourself?

Property is an 3 bed 1 bath 1230 sq ft SFR in a fairly hot market (Seattle) on a third of an acre.

In the back yard of the property lies an 800 sq ft double wide.  The previous owners were using it as a shop.

The square footage of the shop wasn't included in the listing.  Is this because the structure wasn't permitted?  Or possibly because it wasn't finished?

If we were to to a bare bones remodel on the double wide (laminate flooring, drywall & paint, lighting) would the extra square footage be included in comparisons and appraised value?   

It would essentially be a giant recreation room/family room. 

My gut tells me that if minimal money could turn an essentially unusable space and add an extra 800 sq ft of usable space that it would never be a bad idea but will it count in an appraiser's eyes?  

Trying to add value and force equity in a quirky set-up.

Apologies Wayne, I did say it was an MLS listing. That wasn't true, I found it on Redfin or Zillow I believe. But there was no seller agent attached to the listing nor was there a contact to get in touch with from the lender, there was no contact information at all. I ran the parcel number through the county website and got as much information as I could. As much as we do love that neighborhood, I only have been pursuing properties that have cash-flow potential or built in equity. Which surprisingly, if the county website is anywhere near accurate, it looks like there may be some 'meat on the bone' so to speak. Fingers crossed!

I was fully prepared to get the door slammed right in my face.  Definitely had to psych myself up!  We were actually hanging out with family members that had been foreclosed on right before leaving for the house.  I asked them how they would feel if it were them in that situation again, they told me he would have been upset for sure (didn't help my nerves).  Onward!  We made our way to the property anyway, I wasn't leaving until I at least asked the owner if he was interested in selling.

Basically, I told him that we were interested in relocating into his neighborhood (which we are, though it would be a BRRRR rental until we were ready to move) and if he was interested in selling his house. He then mentioned that I must have been doing some foreclosure research, where I then geared up for immediate rejection. I told him there were multiple properties that we were interested in and I thought the best way to try to get in was to meet the owners and ask them in person (may have gained a small amount of respect there). I told him that if it was something he was interested in that we could both potentially benefit from a transaction.

[Also, tried to implement some Michael Quarles wisdom and take a couple steps back after knocking on the door and threw in some Chris Voss by trying to mirror a few things that he mentioned.]

In (what I imagine was simply a defense mechanism) turn he mentioned that this is just something 'they do' year after year (NOD's have been filed for multiple years in a row, I can't imagine there is any strategy there) and that the place was not going to be foreclosed on. But immediately after that he said, 'Buuuuut, let me get your information...'

Long story short, it was nerve wrecking and slightly terrifying.  I had to remember my 'WHY' and it out weighed the potential rejection.  I believe that it's much easier to throw a yellow letter away than it is to completely ignore someone that is at your door.  Not just that, but your presence can hopefully leave more of a personable impression.

I wasn't leaving the neighborhood until I did it and I'm stoked I did!  We've written a follow up with an attached picture to solidify our interest and keep the door open to further the relationship.  Excited for what may come of it but no matter what I won't have any 'what if's'!  

 Good call.  I know the area pretty well and it's fairly laid back but in today's litigious society it's never a bad idea to check.  This particular property has avoided the foreclosure auction going on four years now, I can't imagine this being a sustainable model for the owner.  Very curious if we hear back from him.  We put together a follow up letter thanking him for his time and re-establishing our desire to possibly help one another.

I DID IT!  First door knock complete!  Was prepared for a door slam and instead the owner took down my details.  Now we'll see what happens!

Thanks to BP for all the support hahahahaha

I've found a property I'm interested in which a 'notice of trustee sale' has been issued and is 'scheduled' to be auctioned in a couple months time.

It appears to not be completely repossessed by the lender and the owner of record lives at the property.  The lender on the property is Wells Fargo.

However, there is no listing agent or attorney representing the lender that is attached to the MLS listing that I can find. I also cannot find the property on Wells Fargo list of owned properties to inquire about it.

I'd love to have this property as a long term buy and hold rental and/or eventually as a primary residence.  There is substantial equity in the house.  My plan is to knock on the door and let the owner(s) know I'm interested in purchasing the house.  

Is it as simple as establishing contact, creating a relationship and drawing up a purchase agreement (obviously with title and inspection contingencies)?  Do I then need a RE agent/broker/realtor or an attorney to draw up an actual contract assuming we come to some sort of purchase agreement?

How does financing work at this point assuming I don't have a briefcase full of cash?  Use a hard money lender to pay off the existing balances on the house and then get it refinanced in my name (paying off the hard money lender after using the built in equity)?  Just take the purchase agreement, transfer title and take it to my conventional lender?

Does Wells Fargo need to be involved with this somehow?  

I know this topic has been beat to death so thanks in advance for any advice pertaining to this particular situation.