Pre foreclosure homes, in particular, offer a unique chance to snap up valuable real estate investments at below-market rates.
Savvy real estate investors have long known that off market properties can be extremely profitable. If done properly, opting for pre foreclosure listings is a real estate investment strategy that is guaranteed to yield immediate returns.
So what exactly is a home that is in pre foreclosure? How do you buy a house that is in pre foreclosure? And what are some of the best ways to find pre foreclosure homes? This article will clarify all these points and show you how to find pre foreclosure homes in a matter of minutes.
What Are Pre Foreclosure Homes?
Before showing you how to find homes in pre foreclosure, let’s define this concept first. As the name clearly implies, pre foreclosure homes are properties that are still in the first stage of the repossession process. A home goes into pre foreclosure the moment the lender files a Notice of Default. When it happens, the property owner is faced with two options; repay the debt and reverse the status, or offload the property before it is repossessed.
From a real estate investor’s perspective, the second option presents a good opportunity to secure an undervalued real estate investment. It is due to the simple fact that the property owner will be under a significant time constraint and is, therefore, more likely to accept a relatively low offer. Here are some other advantages of buying pre foreclosure properties:
- You typically won’t have to deal with any competition when making an offer
- The buying process is very quick
- Unlike buying at an auction, you are able to visit the investment property and inspect its condition
Now that you are familiar with pre foreclosed homes, let’s delve into the investment property search and outline how to find pre foreclosure homes in the US housing market 2022.
Related: Pre Foreclosure vs Foreclosure: The Difference
How to Find Pre Foreclosure Homes
Finding pre foreclosure homes is achievable through a wide range of methods. In fact, there is no dearth of options when it comes to identifying these investment properties. Moreover, there are several real estate investment tools that can aid in the process. In any event, here is how to find pre foreclosure homes in 2022.
1. Work with a real estate agent
As always, working with a real estate agent is a viable option when investing in real estate. In fact, it is not that difficult to find expert agents who specialize in the very same type of real estate deal that you are seeking. In the case of pre foreclosed homes, you need to retain the services of a real estate agent who is familiar with the property repossession process.
Working with one will allow you to avoid some of the common mistakes that novice real estate investors make when dealing with the foreclosure process for the first time. Needless to say, this does not apply to you if you happen to be a seasoned investor.
Related: What Are the Different Types of Real Estate Agents?
2. Sift through public records
Public records are often a reliable source of off market properties for sale. Moreover, this data can be accessed for free and is readily available to anyone who is willing to sift through it. Even better, you can hire a third party to mine all the relevant information on your behalf.
The data that you should focus on when going through public records includes the Notice of Default letters that were issued in the area as well as any Lis Pendens and Notice of Sales. The public records also include the address and name of the owner, which makes submitting an offer much more convenient.
Related: How to Make an Unsolicited Offer to Purchase Property
3. Use real estate websites
There are several real estate investor websites that offer access to pre foreclosure listings. A prime example is the Mashvisor’s Property Marketplace. It is, by far, the best real estate website on the market as it offers a wide selection of properties that ranges from pre foreclosure homes to tenant-occupied rentals.
You’ll also get access to the data you need to analyze any property for sale. In fact, the tool allows a real estate investor to identify the ideal investment in less than 15 minutes! Additionally, it boasts a simple and intuitive interface that is easy to navigate.
4. Explore your real estate network
Agents are not the only real estate professionals that can help you land a home before it hits a pre foreclosure auction. To maximize your chances of securing an investment, get the word out to everyone within your real estate circle. iT includes everyone from mortgage providers that you have worked with to real estate attorneys that have helped you close previous deals.
Another group of professionals that deal with pre foreclosure listings is real estate wholesalers. As a matter of fact, you might know a wholesaler who has extensive knowledge of a particular area as well as the types of listings that are currently on that market.
5. Search newspapers
This might seem like an antiquated method, but searching local newspapers is still an effective approach in today’s real estate market. Most newspapers include a legal notice section, which is where you should focus your attention when looking for pre foreclosed homes.
In it, you will find a list of homes that are expected to be sold at a future auction. Having said that, legal notice sections don’t contain a lot of information about the income property and the real estate investor will still have to do a lot of work in order to obtain a lead including gathering more homeowner data.
The Bottom Line
Finding pre foreclosure homes has never been easier. Thanks to the growing popularity of the internet, as well as various real estate investment software solutions, you are always just a few clicks away from securing the perfect real estate investment. For more real estate investing tips, head over to our investment blog.
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