Investing in preforeclosure homes (homes that are in the foreclosure process but that have not yet reached the point of the foreclosure auction) can be quite lucrative. So, how do you find these potential gold mines? Below are four ways.
Look for preforeclosure homes online. You can search for preforeclosure listings in the comfort of your bathrobe. It’s easy and convenient, but do keep in mind that numerous others will have the same quick access to this foreclosure information; you won’t be the first.
There are many online foreclosure listing services that provide information about pending bank foreclosures, as well as on bank REO (Real Estate Owned) properties (properties that were not sold at foreclosure auction). Most charge a monthly fee, so check out the trial services first to see which foreclosure listing services provide the most preforeclosure information, and which service you’re happiest with. Many foreclosure listing companies provide additional information on the preforeclosures, including name, address, loan amount owed, and additional loans outstanding. A few will provide contact phone numbers for the current owners of a preforeclosure home.
In addition to finding preforeclosure homes and REO (bank owned) properties through foreclosure listing services, you can often find REO information online at bank sites. Many national and regional banks list their REO properties at their websites, and this information is free.
Search the online newspapers. Search the Public Notice sections of your local online newspapers to find preforeclosure homes. During the foreclosure process, the Notice of Sale is required to be published in a public newspaper.
Search public records. At your County Recorder’s Office, preforeclosures are recorded with the County Clerk. Finding preforeclosure homes this way could be one of your best bets, because preforeclosure homes that are newly listed here may not yet have reached the online providers of foreclosure data, and finding the preforeclosure information this way is free. When looking for preforeclosure homes here, search for a Notice of Default (NOD), or a Notice of Trustee’s Sale.
Find Asset Managers. Asset management companies help lenders dispose of assets like foreclosed homes they can’t sell at foreclosure auctions. When a preforeclosure home goes to auction and completes the foreclosure process and is not sold at auction, it becomes an REO property. REO properties are an example of assets that lenders don’t want to hold onto, so you can often find REO properties through asset management companies, and it can be as easy as visiting the websites of these companies.