| One of the best known, but least understood, ways of | | | | amount of room for a profit are most likely to be |
| buying foreclosure properties is to buy them at a live | | | | attended by a bigger group of investors. The key is to |
| foreclosure auction. Depending upon where you live, a | | | | do your homework well, because a mistake can be |
| foreclosure auction will generally be held either at your | | | | very costly. |
| county courthouse or in some other public place. | | | | If you want to check into auctions yourself, the first |
| Sometimes the auction will be conducted by the | | | | thing you have to do is find out which publication is |
| county sheriff and sometimes by a proxy appointed | | | | used to list them. Often it's the legal section of your |
| by the court. Regardless of who is chosen to conduct | | | | local newspaper, although some larger cities use |
| the auction, the result is the same: the property is sold | | | | specialized business papers to advertise foreclosure |
| to the highest bidder. | | | | sales. There are also various services that will notify |
| The first bid is typically made for the foreclosing lender | | | | you of foreclosures in your target area if you |
| by whoever is representing that company. The bid will | | | | subscribe. If you happen to be interested in a particular |
| generally be for the amount that's owed, although | | | | property, you can contact the firm in charge of the |
| there doesn't have to be any actual exchange of | | | | auction for information about the time and place of the |
| money involved. If no one else puts in a higher bid, | | | | auction. Call the day before the auction to see if the |
| property ownership reverts to the lender. | | | | defect has been cured or the sale has been delayed |
| In the majority of cases, no one shows up for the | | | | for some reason. |
| foreclosure sale except the proxies for the lender and | | | | Always remember, if you bid, you must follow through |
| whoever may be running the auction. That's especially | | | | with the purchase. There's no turning back once |
| true if there's no room for profit between what's owed | | | | you've committed to buy a foreclosure property at an |
| and the market value of a property. | | | | auction. So do your homework. It would be wise for |
| Make no mistake: foreclosure auctions aren't generally | | | | you to choose a few target neighborhoods and |
| places for beginning investors, because you'll need | | | | specialize in those areas, so you'll know how much |
| access to either significant amounts of cash or a large | | | | profit is available even before you consider bidding on |
| line of credit that you can tap into quickly. If you have | | | | a certain property. |
| either of those resources at your disposal, you can | | | | Although it's rare, you can occasionally find some great |
| sometimes find great buys at foreclosure auctions, but | | | | deals at foreclosure auctions. If nothing else, you'll find it |
| you have to be careful, because most of the time the | | | | educational just to attend a few, just to see how the |
| amount owed doesn't leave much room for profit, if | | | | system works. |
| any. The properties that do contain a significant | | | | Copyright © 2006 Jeanette J. |