Exactly How to Find and Buy Foreclosed Homes

hello Internet my name is Ryan Ingram and today we're gonna be talking about foreclosures we're gonna be talking about how to find a foreclosed house how to buy a foreclosed house we're gonna be talking about the foreclosure process and how you can generate a tremendous amount of wealth inside the equity of these foreclosed homes this includes bank owned real estate owns homes from sheriff sales and pre foreclosure homes this is going to be an absolute phenomenal tool to put in your proverbial tool belt so that you can go out build equity turn these foreclosed homes into either a home that you have a boatload of equity in or a rental property that you have equity in and cash flows for you each month in this video we're also going to be talking about exactly how I used this information to generate over one hundred and sixty thousand dollars of equity in my personal portfolio first things first if this video adds any sort of value to you whatsoever please hit the like button that'll help me out a lot and if you're new to the channel you're probably wondering who is this guy and why should I listen to him well like I said my name is Ryan Ingram my brother and I we bought our first rental property back in August of 2017 that was a duplex we've since acquired 63 doors primarily those are single-family homes we've got a four unit a few duplexes but that's about as big as we go we're not into the commercial space but we've been able to generate over a million dollars worth of equity by finding distressed properties creating value to them by fixing them up and making them great homes for families that's who I am now if you want to know exactly how my brother and I were able to add a million dollars of equity to our portfolio over the past two years then subscribe I'm gonna be going over every single deal we've ever done in detail explaining exactly how much of cash flows how much we financed where we found the financing but now let's go back to exactly how to find and buy foreclosed homes and how it made a hundred and sixty thousand dollars of equity for my brother and I okay so first let's talk about what is a foreclosure now a foreclosure is pretty simple it just means that there is a mortgage or a lien on the property so if there was a mortgage on the property then the bank had a contract or mortgage with an individual if the individual stopped paying according to the contract terms then the bank now has the ability to execute on this contract foreclose on the property and take the home but it doesn't have to be a bank it could be like a mechanic's lien where a contractor did work and wasn't paid appropriately he could put a lien on the property if the contractor never gets paid then he can also foreclose on the home so if you hear the word foreclosure it's safe to assume that there was a contract on the property that outlined agreed upon terms at which payment would be received that payment stop being paid and now the property is being taken as collateral and they're gonna sell the property whoever the contract hat was with is gonna sell the property to try to recover those funds that they are owed now the foreclosure process also pretty simple and there are three points at which you could purchase the property the first stage of the foreclosure process that you can buy the property is called the pre foreclosure now a pre foreclosure during this process the the lender or whoever holds that contract is just notifying the individual that this property will be foreclosed on if they do not make those payments now this is a common and successful tactic for wholesalers because at this point in the process is the only time that the actual person or the individual on the side of the contract can walk away with any amount of cash now you could potentially make a lot of money in this process and you could also add value to the individual that's being foreclosed on let's say that the individual purchased this house for $100,000 and they're living in the property let's say they put 5% down so they put a $5,000 down payment and the bank is owed $95,000 just for ease of sync let's say that this foreclosure happens and the individual that bought the property was never able to make any successful payments and this loan balance is for sure ninety five thousand dollars so during this pre foreclosure this is the only time the individual being foreclosed on could possibly recover any funds so what a wholesaler could do and what is great value is let's say for some reason they got a deal on this property and it has appreciated something crazy happen in the market the property is now worth a hundred and fifty thousand now that might be a little sir that's high but I'm just proving a point here so you could be a nice guy you could pay the person back their $5,000 you could either assume the loan or pay it off if you assumed it that would be called a subject - that would be really dependent upon this person that's being individually foreclosed on now this $95,000 let's say that's wiped away you pay them $5,000 so you have this original $100,000 that you bought for the pre foreclosure but now you gained the $50,000 of appreciation so whenever you do this process in the pre foreclosure you pay the person the individual walks away hold they never lost anything except time in their home but now you walk away with $50,000 of equity because you have a house that is worth a hundred and fifty thousand you've paid off the bank the bank's made whole the foreclosure stops and everybody is happy the bank got their money the individual got their money and now you have $50,000 worth of equity and with that that's everything I know about the pre foreclosure process it's also worth noting that I have never purchased a property from this pre foreclosure process I have only purchased properties in the second part which is just the actual foreclosure now you might have heard someone talk about this saying I bought the property on the courthouse steps that's what people say when the foreclosures actually in the process of happening as I was writing that I realized I fibbed a little bit I've purchased properties in this stage too nonetheless what this is the foreclosure of the courthouse steps the way I did it it wasn't nearly as cool it wasn't on the courthouse steps I was actually on the seventh floor of the courthouse now at this stage this is when the foreclosure is actually in process so generally it happens in a room full of people it's open for bidding and in this stage now let's go back to that original statement that I just said let's say that the bank is owned ninety five thousand dollars if the bank is not present then the minimum bid amount will start really wherever the county chooses for their arbitrary reasons I couldn't possibly understand and the inner workings of the government even if I wanted to but the bank will oftentimes either have some sort of represent representative there an attorney or just someone from the foreclosure department so that they can place a bid for ninety five thousand so that at least they're gonna be able to either walk away with a property and later sell it for the ninety five thousand so that they're made whole or they could be outbid at the foreclosure and let's say now the bank bids ninety five thousand somebody else perhaps even you if you know the property is now worth a hundred and fifty thousand by all means it would be very prudent and wise for you to now bid ninety five thousand one hundred or whatever the next increment is that you could possibly bid on the property that way you could potentially walk away with fifty five thousand dollars of equity if it's a really great deal then it's probably gonna go up closer to that one hundred and fifty thousand dollar mark but it's really a potluck sometimes people show up other times it's crickets and nobody's at the sheriff's sale or at the courthouse attempting to buy these properties so it's always good to keep a thumb on exactly which properties are inside the queue to get foreclosed on and if any of them are worth bidding on if they are you need to figure out how to get into the courthouse and when they meet now if a bank is gonna show up and if a bank is concerned about losing their money then one thing that I've seen the banks do is advertise this property as a pre foreclosure on the MLS or the Multiple Listing Service that's just if you type in and you find like Zillow Trulia red fin realtor.com those places that advertise all the properties for sale in an area you will sometimes see pre foreclosures listed as for sale and that is the bank attempting to just drum up a bunch of interest so that people come and bid on their property so that they don't lose money or have to go through this next process it's honestly really smart now the bank might not be doing it the bank might have a contract with a realtor but nonetheless that is how the pre-foreclosures get listed on the MLS now this third way is also pretty cool and I've recently purchased three properties from this stage and that is the post foreclosure or the bank owned properties or REO real estate bond now in this stage what this means is a representative from the bank showed up and they now own the property once more and they're trying to sell it for whatever they have in it plus probably some other markups for administrative fees contracting out a realtor their attorney fee for showing up at the foreclosure or a variety of other things now what's really interesting is in this process sometimes if you've heard of like a Fannie Mac Freddie Mac or government-backed mortgage programs then what happens in this second process that I accidentally overlooked is if this ninety five thousand dollar loan was backed by the government that what the bank would do is they would come and they would bid the property up to ninety five thousand they would then take possession of the property and they would sell it back to the government or whatever the federally insured amount was this way now the government takes control of the property and not the bank so at that point the bank isn't going to be listing these as a bank owned you could also have a HUD home or the Housing Authority of Urban Development I know the und for sure or Urban Development and because I'm in front of you Internet the entire world I can't remember the H I know it's housing but I just don't know how they tie together secretary of housing Urban Development maybe I don't know I'm just guessing at this point but let's get back to the more important thing of how you can buy these these are also going to be on the MLS that most ballistic service and you're going to be able to see these and they are a lot less negotiable or malleable so in this stage you could probably buy the property from the current owner that is being foreclosed on for a slight markup here you have the potential if the bank doesn't show you could bid it for whatever the county sets the minimum amount or in this stage you can pretty much pay what the bank is asking which is probably gonna be somewhere around that ninety five thousand mark now if for whatever reason this property doesn't sell for several months you are gonna see that price get lower and lower because at that point they have holding costs just to hold on to these properties that is really eating in to their profit so the price might lower just so that they're made whole sooner because time is really valuable alright now that we covered these three stages how do you find these if you go through court documents and pay attention to which properties are being foreclosed on and how which banks are filing on them which is all public record so you're gonna be able to go down to your courthouse or log on to the recorders and see this process happening you're gonna be able to get a list of properties that are about to be foreclosed you could also buy lists from some of these list service providers and go through there but these lists can get costly especially if you're targeting a particular area there is no reason to go out and buy a list you can just figure out and identify what area you're targeting and then go to your courthouse and look for particular properties in that area once you find those listings then you're able to solicit to approach these people and I would be really confident in doing this and just remember that these people are your clients these people are the people that you're trying to add value to so if you're knocking on somebody's door it's gonna be really uncomfortable to say something like hey I heard that you got foreclosed on or I heard that you're in the process of getting foreclosed on I want to buy your house I don't know how comfortable you are doing like the ultimate cold call of knocking on someone's door and say hey I know you're in financial trouble but if you can do it if you're a people person I'm not a people person I come off as crazy intimidating and that's why I have these crazy thumbnails right so that's not the avenue for me but I would be happy to pay a wholesaling fee or a fee to someone who does have the ability to go out and convince people to sell them the house as they're being foreclosed on but it's just a service that you're adding in the pre foreclosure phase so that the individual that currently has the property can walk away with some or of their money depending on how good of the deal it is in this stage I know there are a lot of like real estate gurus that sell courses on how to construct what they call as subject to deals and in this subject to deal what they do is they buy the property subject to the mortgage so that means that the individual that's being foreclosed on is gonna maintain the mortgage and you're gonna buy the property but the mortgage is gonna stay in place so at this point the individual that has the property still maintains all of the liability because even though you're purchasing the home the mortgage is still gonna be in their name so if you start missing the payments their credit is dinged but at the same time they're in the foreclosure they might be in over their head not knowing how to get out and this may be a very viable situation or solution to help them when this works right it's really good for all parties involved so that is how to find and how to buy properties in the pre foreclosure process can we erase that one now I think we covered it if you have any comments any points of clarification that you would like please let me know below I'd be happy to answer these I'm truly trying to keep up with these comments and respond to each one of them can't wait to hear from you confused person alright so now we're gonna talk about how to find or buy foreclosures in this stage of the foreclosure process which is the actual foreclosure this is when it is at the courthouse live for bidding so you can find these properties in the exact same way that you could find the pre foreclosed homes and that's in the courthouse records you might also be able to find them on the MLS if the bank or whoever is foreclosing on the property wants to drum up some business to get more people at the courthouse on the day that it goes to bidding this is one of my favorites when I first started in real estate investing a buddy of mine every Friday morning is when they're held here we would show up at the courthouse we would sit together drink a little bit of coffee and watch what these properties actually went for it was really fun to see the process unfold you had some attorneys some bank representatives sitting there and the minimum bid would be $1,500 and then they would immediately bid it up to 5060 thousand dollars it's like whoa that escalated quickly but it was just really cool to understand the process and to see it play out in front of my eyes I would highly suggest if nothing other than just the experience factor you go to the courthouse you experience this process yourself in your local area that way if you ever do come across a great deal in the pre foreclosure process or if you see it in the records if you see a house down the street that you really love from where you live you can say oh that's in the courthouse record for the foreclosure it's gonna happen I could potentially get a great deal on that property because remember at this point the bank may or may not show up so if somebody doesn't show up from the bank if they're just like man this person has been delinquent for a year now we're never gonna get any of our money back let's just foreclose on it let's let the county handle it and let's just receive whatever money the county gets from it for whatever reason that's truly some banks plans so at that point what you can do is you can show up and buy a property for a very low amount of money the lowest I've purchased a property from here is ninety five hundred but don't get too excited because that was the worst property I ever purchased from a foreclosure the floor was just layered in dog poo but now it's a great property where my best friend lives all right now I'm comfortable with phase two it's very clear-cut show up to the courthouse put your bid in you might get lucky okay now this third and last stage of the process is the post foreclosure this is whenever somebody showed up from the bank they took possession of it they either sold it back to the government or now they own it and they've listed it on the MLS with a realtor that they've also hired to represent them to now try and sell the property so in this stage you're going to be dealing with a realtor it's gonna be on the MLS you're gonna need to either go to the listing agent in order to buy this property or contract with a realtor of your choosing and at this point you can put in your best offer but know that the bank wants to get out at least what they have in the property now if this is a HUD home you can go into one of my favorite apps which is the HUD home store app this is both an app and a website this app or website has personally made me $85,000 of equity over the past few days so far this year I've purchased three HUD homes one for twenty thousand one for thirty two thousand and one for forty three housing all of them are worth at least seventy thousand dollars so that was a giant win for us and honestly really easy if it makes it to the HUD process then generally for the first 21 to 30 days I really don't know but but a realtor that specializes in HUD homes would know that exact date again because I'm in front of the Internet I can't think of it but for the first few days I'll just say it like that for the first few days it's listed for sale it's probably gonna be for owner-occupants only after a certain amount of time passes and it doesn't sell then at that point anybody can bid on it it's open to everyone it says open to all bidders or extended and that means that anybody even investors can bid on it and the cool thing about bidding on a HUD home is it's not like the normal process where you put in your offer and you wait to hear back from the seller the bidding ends every night at midnight and then you'll probably know I was notified as early as 7 a.m. on whether I got the property and as late as 9 a.m. but nonetheless it's a pretty quick process and then from about 30 days after you're notified of whether you get it or not then you actually have the closing and then you take possession of the property okay now I told you that I was gonna tell you exactly how I made over a hundred and sixty thousand dollars of equity by buying foreclosed properties and now we're gonna go through that really quick the first property that we're gonna go over is the worst one that I've done and that's just because I hate it so much I want to get it out of the way so this is the one that we bought for ninety five hundred dollars at the actual foreclosure so we were in the courthouse a little old rining or and put up his hand and kept bidding all the way up to ninety five hundred there was one other guy there he stopped bidding at ninety four hundred I mean truly I just bid $100 that was the minimum bid increment so that is how that worked even though I got it for ninety five hundred at the time the ARV was probably around forty thousand and it took every single bit of $40,000 to get it up to speed it needed a new roof new water heater we tore out all of the walls we gutted it like I said it was just layered and dog poo but hey my best friend lives there now but nonetheless I only made $5,000 of equity on this home which is left in the property the second property that we purchased was also in the actual foreclosure process we bought the property for $35,000 we didn't have to put much work into it I think we put about $10,000 into it and it's currently worth $80,000 so we made thirty-five thousand dollars of equity on this property the third one is very similar again inside the court houses when we put our bid on it we bought this property for thirty thousand ten thousand dollars worth of work and now it's worth seventy five thousand it's a little bit smaller I wrote the wrong thing thirty five thousand is what I should have put there the fourth property that I purchased in this I purchased it as a HUD home I'm really proud of it I'm really happy about it and I've already told the internet about it it is the video that's called the 6922 dollar rental property please watch that video as I discuss all of the numbers and even give you a walkthrough of the house we made thirty thousand dollars of equity in that property the fifth property is also a HUD home I also did a video on this one I said the cash flow wasn't too high but we had a tremendous amount of equity we had thirty five thousand dollars of equity in this property and lastly the sixth property is also a HUD home we purchased this property we bought it for twenty thousand dollars it needs a boatload of work I haven't done a video yet on it because I can a crazy underestimated the amount of money that it will take to renovate the property but nonetheless we're gonna be left with about twenty thousand dollars worth of equity so if you add all these numbers up I've purchased six properties from this foreclosure process they've all been awesome I'm gonna go over all of these in detail in the deals explains playlist please watch those if you want to know exactly how I'm structured all of these deals and please subscribe if this is adding any sort of value to you at all because I want to be completely transparent about how I made a hundred and sixty thousand dollars worth of equity and six rental properties that I purchased through this foreclosure process so if you have any questions comments concerns please let me know I eat sleep and breathe real estate I own an insurance agency where I only write insurance for other real estate investors so truly I'm so blessed to be able to talk about real estate investing on a daily basis thanks so much for watching this video I had so much fun putting this together it took me several months to get all of this information as I was learning this buying properties and so it was really cool to be able to shorten it down into this tiny video and teach everybody all the things that I've learned and how I was able to get a good amount of equity in a very short amount of time as I mentioned earlier if you found some value in this please like it that would help me out that would make me look cooler and YouTube's little algorithm and more people would see this share it if you have a friend that's trying to buy a foreclosed home or they want to buy their first property to live in and they want to get a great deal and have boatloads of equity because honestly if you buy your first house to live in and a foreclosure and you're able to just walk in to a few thousand dollars in equity that's a giant deal so thanks ask questions comment I'll talk to you guys soon

Channel: Ryan Ingram

Views: 274,066

Keywords: Foreclosure, Foreclosures, How to Buy a Foreclosure, Ryan Ingram, buying a foreclosure, buying foreclosed homes, buying foreclosed homes at auction, finding foreclosures, foreclosure auction, foreclosure homes, foreclosure investing, foreclosure process, foreclosure real estate, how to buy a foreclosed house, how to buy a foreclosure house, how to buy foreclosures, how to find foreclosed homes, how to find foreclosures, investing in real estate, real estate foreclosure

Id: u3rSfbndGug

Length: 23min 28sec (1408 seconds)

Published: Mon May 04 2020