You've decided you have the knowledge and the resources to follow the foreclosure marketplace, so the next step is, what are you going to follow? Procedures are very different for following pre-foreclosure compared to properties already foreclosed by financial institutions.
Information is everything! If you don't know what properties are scheduled for sale, you are wasting your time. You need to know what properties, how much the loan amounts are and what timeframe you are dealing with. Local newspapers will publish the properties scheduled for sale, this will provide some information and all you have to pay for is the newspaper subscription. You can also go to the county recorder and research documents yourself, but the best way to follow these properties is to subscribe to a service that obtains records and sells the information. The best services give complete, accurate information and others provide the basic minimum, but it saves time spent looking them up for yourself. Once you know which properties are in default, you can approach owners directly to sell, arrange financing to save the property or whatever seems appropriate for all the parties involved. Door-knocking, mailing information or telephone contact, it's all based on knowing which properties fit your criteria. You can find some providers of information at Pre-Foreclosure Listings or you can go to the sale sites in your area and ask the investors who show up for the sale what local providers are available. If they don't want to tell you, ask someone else until you get the information you need.
Banks are driven by numbers. Their non-performing assets do not generate income, they require reserves to be set aside in addition to the loan amount and large numbers of non-performing assets do not look good on the bottom line. So, if the financial institution doesn't really want to be carrying these properties, why don't they sell it cheap? First, if a bank has a large portfolio of bad loans and they do not want to carry them on their books, they sell the loans as a portfolio at a discounted price to companies in that business. Second, if they have taken a property back and now own it, why wouldn't they want to get as much as they can for it? It's called cutting your losses. If you want to buy from a bank, find properties you might be interested in by either following the auction sales or using a service that gives you fresh REO information. Fresh information will allow you to put an offer into the bank before they will have any additional costs in the property and will be more likely to cut a deal. Your best opportunities are going to be properties that need a lot of work, have something wrong with them, or that are in a slower moving market. Banks seem to take forever to respond, place an offer with limited acceptance period, wait out that period, then go on to other things. Placing an offer at 60% of market value is something that probably won't fly. Be realistic about the property, your requirements and the bank's position and an offer just might be accepted. Another possibility is to look for the dogs. Properties that have been on the market for a long time either are overpriced, are ugly or have some other problem. If you feel these problems can be overcome, a bank just might be willing to sell at a reduced price.
We have a page with many sources of Foreclosures