All Forum Posts by: Mat O'Grady

@Matthew McCarty At the beginning of my investing career, I was constantly looking at websites like Zillow and Redfin to see what houses are selling for so that I have a good feeling on the market I picked. I have been able to buy houses of the MLS because their list price was good and I offered cash without contingencies. I also contact the listing agent for the showing and to put in the offer. They are more motivated to get the seller to sign with someone without an agent because they get more commission. You can also look at sites like auction.com, homepath.com and homesteps.com. There are also deals that can be find on jud.ct.gov for foreclosure auctions but those rarely work out because the people usually owe more than the property is worth or they get cancelled and postponed frequently.

@Matthew McCarty and @Aileen Ouyang

Investing in anything is specific to each individual's goals. How fast do you want to scale? Are you OK with getting wealthy slowly or are you trying to do it as quick as possible?

If I were in your position, I would look for a bank or credit union that will give you a line of credit against the rental property. They are hard to find, but they do exist. The line of credit will give you the access to the equity in the property without having to pay interest on it. You pay to open it up, but you won't pay monthly unless you take money out. You will only pay interest on the amount of money you use. This gives you the flexibility to find a deal on your own timeline and to act quickly when a deal does come up because you won't need to get bank approval to use the line of credit. 

Congrats! I am glad that I am not the only one who takes twice as long and spends twice as much, haha. In the end it will all work out.

@James McGovern

I am curious what a land bank is and how it is used....

@Michael Nelson What part of the state do you invest in? That might be helpful for people to know. Also, if you provide numbers on your past deals such as purchase price, rehab cost, rents, etc.

@Ralph Bednarczyk

Yes, I believe you would need to pay the taxes. The taxes take first position, so the mortgage is after taxes. 

@Ralph Bednarczyk It is almost always at least the debt of the plaintiff foreclosing or more. There were a couple times that it was less but then it gets bid up anyway. 

@Ralph Bednarczyk

Have you gone to jud.ct.gov? Is that where you are seeing the auction listed? If so, click on the docket number. Then click on "Back to Case Details." There should be a list of documents for the foreclosure. Find the foreclosure worksheet and that will provide you with the amount of debt on the property and the appraisal value.  

I believe the starting bid is usually enough to get the bank back to even, so it is normally close to the amount of debt that is being foreclosed on.

I believe all of the auctions through Jud.ct.gov are assigned lawyers at random from a list they signed up on. I do not believe they represent the bank other than that they are paid to run auction process. 

You should call whoever his listed and they will give you more information about it. 

@Ralph Bednarczyk

At all the auctions I have gone to, which is only 5 or so, there wasn't access to the house. It says you have the two hours but they usually don't give you access because they don't have keys or there are still people living there. 

I have never seen a bank representative at the auction. I believe the starting bid is the lowest the bank will take and the bank starts with that bid. If no one else bids, the bank buys the house for that bid, so yes, it goes to REO.

@Ralph Bednarczyk

From what I have seen, the starting bid is chosen by the bank. You can call the lawyer handling the auction the day before to get the starting bid. The lawyer does not have anything to do with setting the bid so the condition of the property on the day of the bid doesn't affect the start bid. 

I have never seen the end bid lower than the starting bid. The starting bid is from the bank. Most of the time, the house sells for the starting bid because there is no room to make money for investors. You need to do some research on your own before the auction to see if there is a potential deal. I have only seen a few houses that made sense to go to the auction and when I have gone, there were multiple people at the auctions bidding.

Deposit is 10% of the appraised value and usually, the appraiser has only done a drive by appraisal so you don't know the condition of the inside. 

I have heard about people being able to get a look at the inside of some of the properties for auction, but a lot of the properties are still occupied by either tenants or the current owners and they are not willing to let people walk around inside. 

I haven't actually bought a property from one of these auctions but, I believe if you win the auction, you sign the deposit check off to the lawyer and you have 30 days to pay the remaining balance. I would think that getting a mortgage from a bank on a property you cannot inspect in 30 days would be difficult. If you don't pay the full amount in 30 days, you lose your deposit.