The current home I live and work out of is on the West End of Greenville, South Carolina:
- nestled less than a block from $250,000.00 condos and single family homes of the Pendleton West Subdivision;
- less than two blocks from the Greenville Drive baseball field and Liberty Tap Room (closer than Pendleton West is to the before mentioned attractions);
- 1,500+sq ft., 3br/2ba single family residence;
- built in 2004; and
- bought at a Greenville County Foreclosure Auction done by the Master-In-Equity’s office for $90,000.00.
The current Greenville County Master-in-Equity, Judge Charles B. Simmons Jr., provides an excellent "Primer for Mortgage Foreclosure Sales" on the Greenville County website. Judge Simmons highlights 14 points that are important if you decide to embark upon this path during the recent economic climate.
As an attorney and real estate investor, I felt confident in the process because I had bought foreclosure sales before from banks but not "on the courthouse steps" so to speak. I made several mistakes and got lucky. I do not trust that luck will get me through again so I share these tips:
- Always have title work done/checked on your prospective foreclosure house!– The house I bought was being foreclosed upon the "Smith" family-seriously.
- Physically go see the house. Don’t trust internet services or court records. I visited my prospective house but never got inside. I knew I was going to "gut" the inside to my liking but wanted the "bones" to be good. On another home I went to go bid on, I went by the morning of the auction and there was no house on the lot, just a lot. Imagine how high I would have bid for what I thought was a house and a lot.
- Factor in more time and/or money if it is inhabited. I paid for the first month’s rent and moved the inhabitants of my foreclosure house out because I had just sold my house. I was on a tight time frame with repairs and knew how slow the eviction process could be if disputed or fought. "Honey attracts more flies than vinegar."
- Have financing and closing attorney already arranged. You only have a short turn around time to complete the closing on the house after you put your deposit down the day of the sale. Likewise, you can’t move in or make repairs until you have title, ie close.
- This is not a "new" thing. Some people make their living off of buying homes in foreclosure sales. You may very well find a great deal but don’t think you will be the only one there.
Anytime there is an opportunity for reward there is a risk. Foreclosure sales are the poster children for inherent risks. Do your homework and you can capitalize. Have fun and enjoy your new experience.
If you would like for me to forward you the recent article entitled, "Prudent Bidding at a Foreclosure Sale," by Clifford P. Parson and C. Joseph Roof that was published in the January 2009 edition of the South Carolina Lawyer, please email me (firstname.lastname@example.org) or post a comment request.
A side note: I do civil personal injury law, not real estate law. Outside of paying lots of money for a "Real Estate" class in law school and visiting the records room of a Georgia courthouse, I have no real estate law experience.