How to find pre-foreclosures not listed in the MLS?

Asked by Richard, Simi Valley, CA Thu Nov 12, 2009

I see several homes in pre-foreclosure status and auction status that are not listed on the MLS? All these should be short sales I guess. How can I know about these and put an offer on a short sale?

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Klm725, , Chicago, IL
Fri Feb 24, 2012
To find a foreclosure not listed in the MLS....In most states such as Illinois, there will be one main designated broker for the Hud/Fannie Mae properties. Get a list of the bank approved realtors that list foreclosed properties. They usually are also contracted for property preservation ie...the board ups and weekly inspections of the empty properties. These realtors have databases full of properties that have been foreclosed that are not listed. Why? Because the banks time the listings now and are selling off reo's in packages to investor groups and the properties never get listed, or they are simply trying to manipulate market conditions to make more money. Anyhow...get a list of these realtors from each bank. There are actually only 12 or so banks in this country. Every bank, every credit card company and damn near every lender are actually owned by a small number of companies...Basically meaning even though we have thousands of banks lenders and mortgage companies, there are really only a small number of banks in this country. Contact these realtors for unlisted properties, properties that are being held back and get the info you need. There are also only a few main databases that the lenders use and they all use the same ones to track all of these properties and these databases are private and NOT the MLS. Every Broker approved by the bank as a selling agent will have access to ALL foreclosure info in your state. Don't forget that banks like to maintain a power position especially now. Such as..not responding to offers, taking six months to respond etc....Don't fall for this. ALWAYS stipulate in your contract a short and acceptable response time such as 3 business days. If the asset manager can't even respond in this time then walk. Unprofessional behavior is never acceptable especially from the asset managers and from good and personal experience this is usually a ploy and/or simply a lazy worker. Often times for reasons that are highly unethical and borderline illegal, the asset manager does not want to sell the property. They are pretty much never from the city or state the property is for sale in and their decisions and opinions are not based on facts or good information. It really is a crap shoot. The absolute BEST way to invest is to get a list of say 30 properties you would be happy with, have your agent place one offer after another..one at a time and wait for an acceptance. It is far and few between in this market that a property will be listed at what it should be. Typically I notice that the average listing price in Chicago is 50-60% higher than what it should be. So as a rule you will reduce the offer by a minimum of 20% of the asking. Main lesson to remember here is that the seller (the banks) have no power in the negotiation. Another thing is, the listing agents of most of these properties are not actually good at valuation so finding someone who knows what they are doing and can explain to the (typically clueless) asset manager why they are over pricing the property in the first place. If a property decreases in value, 99% of the time it is because someone made a mistake or simply lied about the value in the first place. Lastly....Imaginary value that was never there in the first place is not a loss to the banks. It is only a loss to the poor schmuck that signed for the debt responsibility. The banks have made more money in the past few years than ever. The have not taken ANY loss. They have only manipulated the paperwork to make it seem that way.
5 votes
Breonnabeo, Home Buyer, Summerville, SC
Fri Aug 21, 2015
Websites like Realty Trac and Foreclosure.com provide the very latest foreclosure listings for those who are currently looking for a new home to buy that went through foreclosure proceedings. For a comprehensive list, read foreclosure website reviews on our site - http://ForeclosureIQ.com
3 votes
Don Tepper, Agent, Burke, VA
Thu Nov 12, 2009
A couple points of clarification:

Not all preforeclosures are short sales. There are plenty of cases in which someone is behind on a mortgage (thus earning the preforeclosure status), but the market isn't being offered for sale. In some cases, there's no equity (in which a short sale would be a logical next step). In other cases, there is equity, in which a short sale wouldn't be needed.

There are hundreds of ways to find them. Investors do it all the time.

One popular way is direct mail--letters and postcards. You develop whatever criteria you're looking for, then do a mailing. You can get the lists from either list brokers or from real estate agents with access to the MLS. For example, if I were looking for people who had no equity, I'd search for people who bought between 2005 and 2007. Not all will be facing preforeclosure. Many are still making their payments. But many aren't.

Other investors do courthouse research to locate people (and thus properties) likely to be in financial distress. Divorce is a prime example. The divorce filings are public record. Market to them, offering to buy their homes.

I'm not sure that the best deals are preforeclosures, though. You still have to go through the time and hassle of a short sale. Why not market to people with lots of equity who want to sell? Find homes that are owned free and clear, or with just tiny mortgages on them. Then offer to buy. You can find some at the courthouse; check the probate records. Or check the courthouse records for landlord-tenant disputes. Then contact the landlords, many of whom just want to get rid of their properties. Or market to out-of-town owners who bought 10+ years ago. There are dozens of other ways, too.

Hope that helps.
3 votes
Brad Gill, Agent, San Jose, CA
Thu Nov 12, 2009
There are several places that you can go but the best site I have found is foreclosureradar.com. If you need any further assistance please do not hesitate to contact a local real estate professional as they can help you find this information as well.

Good luck.

Brad Gill, Realtor (#01385310)
Cell 408.204.7699
Eagle Properties Group, Your San Jose Real Estate Solution
Brad@EagleHomeGroup.com http://www.EagleHomeGroup.com
2 votes
Soniajanki, Home Buyer, San Jose, CA
Thu Jun 9, 2016
These are the tools and techniques to successfully when looking for pre-foreclosure and REO properties. Other real estate investors find them as useful.

Pre-foreclosures - The availability of pre-foreclosures depends largely upon the type of debt instrument recorded against property titles in each state, mortgages or deeds of trust (also called trust deeds or TDs).

1. Try contacting your local county court. Ask if Notices of Default (NODs) have to be recorded as court documents. If the answer is "yes," find out how you can search the new filings; if the answer is "no," try one of the other options below.
2. Find out if the County Recorder has data available online. An easy resource to use is netronline. com. Simply click on "Property Data Online," select the state you want, then click on the county, and voila! You'll be able to see what (if any) info is available over the Internet through the various real estate-related offices in that county.
3. Look in the "legal notice" section of the newspaper. Look for properties that are coming up for sale at public auction (sheriff's sale, trustee sale, whatever), jot down the addresses, the property owners' names, and the tax ID, or at least as much info as you can get from the ad.

http://ForeclosureProcess.net
1 vote
Homes, , Lubbock County, TX
Thu May 24, 2012
you can look at them a http://www.ishortsales.com
1 vote
Ellis San Jo…, , 91362
Wed Apr 25, 2012
Notice of Default (NOD) & Notice of Trustee Sales (NTS) are public record.

The best online data by far is http://www.foreclosureradar.com

It is used by professional real estate investors who bid at the auctions.

If the current homeowner is not represented by a listing agent, you can approach them directly or enlist the services of a skilled & experienced buyer's agent who has a background in distressed situations.


Ellis San Jose
805-616-2272
KW Westlake Village
1 vote
Bob123, , Ventura, CA
Thu Feb 25, 2010
If you notice, most recommend you do not buy at trustee sales.
And most posting are realtors or mortgage brokers.
And since trustee sales are all cash and don't involve realtors or mortgages, it makes sense that most here don't recommend trustee sales.

If you ask an encyclopedia salesman if it is a good time to buy encyclopedias, he'll say "yes".
1 vote
Steve Gould, Agent, Westlake Village, CA
Thu Nov 12, 2009
Richard,

Barry said it all. He makes very sound points by asking the questions of what are you willing to pay as a buyer outside of the purchase price of the home. As far as locating the preforeclosure homes, my partner and I recently started a program in which we are trying to help people out in these exact situations, We are monitoring on a daily basis the "behind the scenes" activity on loan records. We are able to spot the ones that appear to be having trouble and then approach those before its a real issue. We consult with the owners in providing them with all the options available. We are NOT vulchers hunting down the unfortunate. We are truley trying to make a difference in the way this market has turned and make it a better place for all. For those homeowners we consult that have no option but to sell, we then have a "before MLS preforeclosure" listing.
If you would like to discuss this further or have any questions, please feel free to contact me and I will be glad to guide you in the right direction.
1 vote
Jaime Becker, Agent, Sacramento, CA
Wed Aug 21, 2013
Even though I do not promote other third party sites for searching for a home. Zillow actually has a search in place for notice of defaults, auctions and foreclosures.
0 votes
Ellis San Jo…, , 91362
Fri May 24, 2013
I agree with Foreclosureradar.com they are by far the best online source.


To put in an offer you still need to contact the current owner & see if they will cooperate with the short sale process.
0 votes
Rick McGrath, Agent, Modesto, CA
Wed May 22, 2013
For those who want lots of detailed information quickly and don't mind paying a monthly fee, I like foreclosureradar.com . It lists both NOD's and NTS's.
0 votes
Thomas Bohlm…, Agent, Rolesville, NC
Thu May 24, 2012
Your Local Court House is the best.

Most so called forclosure public information web sites a bit late to the party.

To place an OFFER, contact a local Realtor that has experience in Short Sales or Forclosures.

Good Luck
0 votes
Rachel, Renter, Harrisburg, OR
Sun Apr 29, 2012
I can tell you exactly how to find foreclosures in each and every state - see realty trac and other sites charge outrageous fees - all I ask is ten dollars and that is for my time and thats it - it goes through pay pal so its safe and you can even talk to me on the phone if you want - why do I do this? Because I am an honest person and I am sick of seeing all of these spam listings wanting peoples money for out dated lists of foreclosed on homes - its actually very very easy to find the updated lists for free - shoot me an e-mail and I will let you know exactly how to do this for real no bull crap here just the answer your looking for e- mail rrblain@msn.com if your not happy with what I have to say I will definatly give you back your ten bucks - thanks
0 votes
is there a good way to find homes that are at risk of foreclosure?
Flag Wed Feb 22, 2017
Bonnie Sterl…, Agent, Simi Valley, CA
Tue Mar 27, 2012
IF you really do not want to be sucessful purchasing a home in Ventura County, foreclosure of any type or other sale, be sure to read and follow an appraiser from Chicago's recommendations. It's nothing personal, it's just that these suggestions will absolutely not work on Ventura County California and to post such irresponsible business practices in an area a professional is not familiar with causes a considerable amount of confusion to people who are trying to get clear and transparent information about the home buying process.
0 votes
Barry Shapiro, Agent, Camarillo, CA
Sat Mar 20, 2010
Hi Richard,
Our real estate team services all of Ventura County and we subscribe to a service which gives us access to the NOD and trustee sale information in our market. After checking out our website, if you'd like to contact us regarding our upcoming short sale listings, we can discuss a mutually beneficial relationship. Are you looking for a Simi Valley short sale or a Moorpark short sale? This website is primarily designed for Ventura County homeowners to find foreclosure help online.
0 votes
Bonnie Sterl…, Agent, Simi Valley, CA
Thu Nov 12, 2009
Hi Richard,

Just to add a little more info to what you are reading from others on this forum.

I have been the local RealtyTrac representative for over 4 years. Trulia gets their preforeclosure informaiton from RealtyTrac. RealtyTrac gets their information from data exchanges with filings at County Recorders offices accross the country, including our own in Ventura County. The data is just exchanged by computers there is no human review of the data. So, the information fhat is exchanged with RealtyTrac is accurate but may not reflect anything that is actually going to occur with the home. For example if the notice of default is filed for a second trust deed, it will look like there is a preforeclosure you can purchase for pennies on the dollar.

It is important to consider that while property lies nearly abandonded across our country, we have an inventory shortage in many areas of Ventura County, Simi Valley for sure. There are also Realtors and investors who watch these listings professionally. Should a homeowner fall into default, they will be approached by 3 dozen Realtors who do what Stever Gould describes. If they are realistic about their situation they are likely to list their home with one of those agents. Investors sometimes get involved at that stage or may go to the county courthouse steps to purchase a home with all cash when they are having the foreclosure action, these are just a few ways that homes in preforeclosure make their way into the market.

Working with RealtyTrac as a local representative in Simi, Moorpark and the Conejo for a while I can tell you that if you need to use financing to purchase your best, most time and price effective way to search is to start working with a Realtor. Look at everything in your price range, preforeclosures, foreclosures and regular sales. You never know who is going to have the home that most suits you, if you are purchasing your primary residence or are investing in a property that will require financing. About 75% of my buyers in the last two years have successfully purchased a preforeclosure or REO property but the other 25% or so, found the right home in a typical sale.

If you are looking to work with a Realtor who understands the importance of finding a good value - meeting much of your criteria including location, amenities and price, you wil appreciate looking with me. I would be happy to set you up with MLS Alerts which will provide you with up to the minute data about homes that come onto the market, preforeclosure, REO and regular sales, direct to your email address. The service is automatic, free and I promise not to pester you. Please contact me directly if that sounds good.
Web Reference:  http://www.SimiLiving.com
0 votes
i am now sick and tired of lying gurus who pretend to help but would charge up to the roof prices .i need expired mls listing if you can set me up pre foreclosure i would be happy .i know there is no easy way to riches but i don't want to be poor because i gave up all my allowance to lying gurus.i am working with realtor , email:abaogudelia@yahoo.com thanks in advance.
Flag Fri Jan 2, 2015
Kevin Walton, , Ventura County, CA
Thu Nov 12, 2009
Hello Richard,

Here's some additional food for thought. From a lending point of view, there is some sound advice given here by everyone who has reponded to your question. It's not uncommon for lenders to take from 6-12 months to approve a short sale. As far as using your own funds to fix repairs ie..termite or other health and safety issues, there is a loan out there, the FHA 203k Streamline, that gives you your purchase money first mortgage loan to buy the home + up to $35,000 in cosmetic repair funds ...all in one loan. You can finance the repairs into the loan. You can use the funds for appliances, a new roof, carpet ,paint, termite repairs, downspouts and gutters and the list goes on. There are some limitations though ie..no room additions amoung other things. I can give you a list of things you can and can't do.
Due to the low inventory of homes, it's created a bidding war at times which is discouraging for buyers.
In light of this, don't forget about those homes that have been on the market for awhile that may be "undesirable" or may have some issues. The 203k Streamline is a perfect loan for that situation.
On a side note, if you do have the cash and haven't been down to the county, 800 Victoria, to see how a trustees sale works, beware. There's a clique of investors that are regular bidders there that you need to get to know. You need to see how the bidding dynamics work. You don't want to end with a home that has been artificially bid too high.
As Barry said, there's no rush, distressed properties will be the norm for awhile.
0 votes
Voices Member, , Benton County, OR
Thu Nov 12, 2009
0 votes
Barry Shapiro, Agent, Camarillo, CA
Thu Nov 12, 2009
Hi Richard,
A short sale is a property for sale, in which the owner cannot afford the current payment (for a variety of reasons) or is forced to sale due to relocation, divorce, etc., and in which the liens on the property (mortgage, tax, HOA, contractor, etc.) are greater than the current equity position, minus selling costs. Although you may think buying a short sale is a great way to buy property at a bargain price you MUST have the make-up of a true short sale buyer in order to sustain the long process. First of all, your offer will not be the only offer received by the seller. Your offer may or may not ever get forwarded along to the Bank(s)... Interest rates may be higher or lower 3 months, 6 months or even 12 months or longer, once you finally do hear back from the first lender. Then, the process of negotiation starts over again with the second lien-holder. Are you ready and willing to pay for your own termite repairs? How about repair items discovered in your physical home inspection? What about all the other properties that will come on the market in the interim? If you have all cash and are savvy in doing your research, you can show up at the trustee sales at 800 Victoria, and buy a property for a real "wholesale" price. These auction properties are then fixed up and re-sold to retail Buyers in a few months after the owners are evicted and renovations are complete. Welcome the wonderful world of real estate!! Local agents, such as Bonnie, Ted and Steve can help you find the perfect home in Simi Valley.... No rush on locating those short sales, as they will be around until at least 2012, when the last of the 2007 5-yr. Fixed loans will reset.
0 votes
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