3 Ways To Find Pre Foreclosure Properties In 2023

With the recent shift in the market and the upcoming economic downturn, there's no doubt there'll be an uptick in pre-foreclosures in the upcoming months. But where can we locate these people that have raised their hands and are saying, I need help? Welcome back to the channel. I made this channel for the new and experienced investor. Those of you who want to live the life you've always wanted through real estate, make sure that you like and subscribe and share this video with your friends. If you don't know what a pre-foreclosure is, Let me tell you, pre-foreclosure means that the homeowner has stopped paying their mortgage to the bank. The bank gives you a grace period. First month, hey, they send you a letter, I'm sorry, we must have misplaced that check you sent us, please send it. Second month, whoops, I guess we didn't misplace the first month's check, now you owe 2 months, could you please Pay special attention to paying this off. Third month, obviously you don't, you don't want to send us a check. It's been 3 months. We're going to start the pre-foreclosure process next month if we don't see the full payment. They don't receive the full payment and they start the pre-foreclosure process, which is basically sending them notice that they're in pre-foreclosure. This notice gets to the county records office and gets recorded on their deed. So that makes it public record and everybody in the world has access to that information. Once you have that information, then you know that this person is raising their hand basically saying, I'm losing my house for whatever reason— lost a job, divorce, Death, whatever other reason, I just don't want to pay. And so this is your opportunity to get this information from different sources and contact them, call them, send them postcards, send them letters, email them, knock on their door. However you'd like to do it, you need to start. Okay, so let's talk, let's talk about the— a little bit about the foreclosure process and how you can benefit as an investor. So last year, 2022, and then actually let's go back a little bit more, December, November, December, actually September of 2021. I get a call from one of my cold callers that says, hey, I've got a deal that I'm working on in Mission Viejo and I've spoken with the seller and they've spoken to their real estate agent and other people and they're getting foreclosed on in 2 weeks. And he wants to know if it's possible to help them, help him out of this situation because he owes $550,000 for this house The after repair value is around, I would say, $950,000 at the time. And I said, well, how much does he want? He says he'll take $750,000 for the property. So he's going to end up getting a couple hundred thousand on the deal if we can close on time. And I said, sure. I mean, I used to do this in 2008 all the time religiously. I said, let me talk to him. So I called him. I said, here's what you need to do. Number one, let's put you under contract for $750,000 because you want to make sure you have a deal. He signed the paperwork, we put him under contract for $750,000. I said, okay, the next thing you need to do is you need to call the bank. You need to call the bank and tell them, hey, here we have a signed deal. This person's going to buy the house from me. He's going to pay me this price, $750,000. Okay, I need you to postpone the sale for at least a month. And banks are pretty open to that. They don't want the property back. It costs them way more money to get that property back. So of course the bank says yes. They send over the demand statement of what is owed on a property, what is owed to them. We open up escrow and then we end up closing on this property. Part of my deal with him was that he was going to stay in the property for 30 days after we closed escrow. I held back, I had him in escrow hold back $20,000 because I don't believe anybody to make sure that they're going to move. And it was pretty specific instructions. If he didn't move on day 31, on the first day of the next month, that $20,000 was mine. If not, that $20,000 is rightfully so his. But if you can guess, he didn't move out. Okay, so $20,000, an additional $20,000 was sent back to me because he didn't move out. And again, here we are at the end of 2021. He stays in this property through 2022, January or so. I mean, he's been in this property for, at the end of the day, I believe he stayed for 5 months. But what you have to remember during that time that the market was doing this, it was pretty much Just a rocket going up. Okay. And so I wasn't too worried about that he was staying there. I was actually making more money as long as he was there. And yes, it was a hard money situation. I was paying my hard money lender. So it is what it is. That's not a problem. He finally moves out in February. I go in. It was actually a light rehab, number one, at the time. And number two, I knew how the market was. Most of our properties, we were putting them back onto the MLS after rehabbing them, and they were selling within hours back then. So people are again being crazy. They're outbidding themselves and others. And the price I ended up listing the property, my initial ARV was $958,000. I ended up initially listing the property for $1.2 million, and I got an offer, I got several offers, but I accepted an offer for $1.3 million. Okay, so $1.3 million, my rehab was really not that much, was about $50,000 on this property, and we ended up selling it. I closed it, it was a cash transaction, and we ended up selling it within like hours and closed in 15 days on this transaction. So that was a big plus. And that was all about helping out somebody who was in foreclosure. Remember, he walked away with a couple hundred thousand. If he were— if he were to be foreclosed on, he would end up losing that money. Okay, so I helped him out, he helped me out at the end of the day. Are you following along? Make sure that you hit that like button and help me get in front of new investors. How do we find these types of people? So there are several ways to find them. I've been talking about different services that are out there, PropertyRadar, PropStream. Those are the 2 most interesting ones, I guess. Those are the ones that are the most popular out there that I hear most of the time. I'm sure there's some others, but here in California, we pretty much use PropertyRadar Or PropStream, and they have all the information. How they get the information— do they actually send somebody over to the courthouse? I'm sorry, to the recorder's office, which is what I used to do 40 years ago, literally go through microfiche. And I'm dating myself, and all of you are going, oh, let's Google that word microfiche. What is that? It's like nobody knows what that is any— like today, it's almost like a fax. It's like, does anybody use a fax anymore? I guess some people do. But anyways, so they send somebody over to get this information. Either that or we are in 2023. Maybe they're actually plugged into a service that just the assessor's office, recorder's office just has this pipeline that they pay into and get this information. That would make it a lot easier than actually sending somebody over there. But Anyways, how they get it, I don't know. You can ask them. But those are the 2 most popular services that I use to find out who's getting foreclosed on. You can also reach out to wholesalers. Wholesalers are doing the same thing. They're getting these properties from PropertyRadar, PropStream, and then they're going above and beyond. So they're actually pulling lists and, you know, they could be pulling lists of absentee owners and just literally cold calling them and saying, you know, hey, We're investors, we're buying properties in your area, and we're just reaching out to see if maybe you're interested in selling your home. And you never can tell when somebody's going to say, yeah, sure, I've been thinking about it. What do you have to offer me? $1 million. Well, it says here it's only worth $500,000. Yeah, I know, but that's what I want. $1 million. You have $1 million? If you have $1 million, put it in a duffel bag, go to the park, put it next to the trash dumpster, and then let me know where it's at and I'll go get it. Joking, but that was a true response that I received once. Talk to real estate agents that specialize in short sales or foreclosures. Okay, they're going to be investors themselves. They're going to know how to search lists, and they're probably going to be doing cold calling themselves. But that's a good source. Find a real estate agent that's actually an investor and they know what they're doing. And they may have some properties that they can source to you. If you've never helped somebody going through the foreclosure process, it can be quite intricate. So make sure that you educate yourself before moving forward, or better yet, reach out to me and I can help you walk through the process. If you're interested in exploring more about this topic, click on this video right here. As always, feel free to reach out to me anytime. I'm always here to help.