Under normal circumstances, lenders keep their cards pretty close to their vests when they have houses in their inventory. Typically, they make arrangements with local brokers in the areas where they have foreclosed properties. The brokers give the lenders a drive-by windshield appraisal, and list the house for a retail price. When the market slows as it has today in many areas, this has been largely unsuccessful, so lenders are stuck with too many homes and too few buyers.
Lenders are looking for alternatives. The last blog pointed out that they are beginning to auction off their real estate invesntory. They are also beginning to list their foreclosed properties on their websites and on craigslist.com. For the person who would rather compete with other buyers and pay higher prices because of using easy to find lenders with houses, this isn’t a bad place to start to find compliant lenders.
On the other hand, the person who wants to find real bargains without any competition is going to have to exercise some initiative. Start with actively looking for houses that show some sign of being in “trouble”. As a rule, they may be abandoned, or they may be in need of major repair, such as a bad roof, that indicates that the owners are short of cash.
When you find such a house, check with the county tax collector and find out where he has been sending his tax notices. You can write a letter to that same address, or you can do a little work poking around on your computer or a criss-cross directory and try to find a telephone number to match the address in the area where the tax collector has been sending tax notices. Then, you can either “drop by”, or call up to begin negotiating your purchase.
Or, if you can find the lender by checking county title records, there’s nothing much better than calling up lenders directly.
Quite often calling up a lender and getting the lender on the phone are two different things. Normally, when you dial the lender’s number you’ll get a lot of choices as to which button to push. Push the one for delinquent payers who want to bring their payments current, or the one for people looking for loan payoffs.
There also may be direct line to Loss Mitigation Departments and REO officers.
What I’ve found to be most effective is to get their FAX or email number and send them an offer to buy their loan for cash at a discount. However you do it, let them know that you are a cash buyer of defaulted loans and foreclosed properties, and you’ll probably get a very nice reception.
