I am often asked about the Property Identification phase of the foreclosure process. This information comes from over fourteen years of personal experience in this field and training from others who have walked the path ahead of me. Learning from the mistakes of others has always been less expensive than making similar mistakes personally.
The LAW
The foreclosure properties that are sold in Georgia Counties are advertised in the legal notices sections of the paper of record once a week for four (4) weeks prior to the sale of the property. These properties are sold the first Tuesday of every month between the hours of 10:00 a.m. and 4:00 p.m. on the front steps of the County Courthouse. A complete list counties and corresponding papers can be found at: http://www.georgiapublicnotice.com/pages/legal_organs
The Homework
Newspaper websites report to have thousands of entries. I am not familiar with all counties, but services exist that sent the facts in spreadsheet format. Our target county generally had 4,000 a month. Imported the data into a FileMaker database where I excluded properties with characteristics outside of the 'buy criteria'. In detail, researched each property at another data service with access to county valuation information to see if it matched our 'buy criteria' - enough to warrant looking at it. This is time consuming and tedious, but excluding the correct unwanted deals is at the heart of identifying a good deal.
The conclusion
After we filtered the data down to near 20 properties, a drive to and visual inspection of the properties under consideration was next. Plotted the shortest route, took photos, made notes about strengths and weaknesses of each one and settled on a maximum bid for the auction. This process always took a full day, 2 people and is very draining. Upon return to the office, I entered notes and photos into the database and printed a few summary sheets to take to the auction for reference. Funds had to be secured and in certified form for the sale. Packed a chair, a book and lunch as we may be at the courthouse the entire 6 hrs. - rain and cold are part of the legal process and rooted in English Common Law.
Next Steps
Assuming you are successful at the auction, the Identification Phase ends and the clock begins ticking (interest or opportunity cost accrues) on the Renovation Phase. The finale is the Marketing Phase. Each one requires it's own viewpoint and retooling. It is a realistic and fair comparison to equate this project with having a child. I am making no secret of the fact that each phase of this process takes enormous amounts of time (much like a new baby), is full of details (each house has it's particular needs and as it nears completion those needs change from toddler to teenager), contains no breaks or pauses and can be described as nothing less than HARD WORK (financially, physically and emotionally). Do not be seduced by the romanticism woven into each home and garden tv show. That makes for great programming, but the realty happens during the commercials by a large crew of tv elves (who all want to be paid) and an accounting department.
Assessment
An honest assessment of yourself at this point is priceless. Consider how much time a project like this takes and compare it with your calendar. Are your family and friends willing to support you in light of the inevitable inconveniences this will bring to their lives, or will it just be a new source of frustration? Which skills and talents will you be leveraging personally for the success of the project? What are you willing to learn to do that you are currently uncomfortable with? What will you be sacrificing to be able to do this well? What degree of renovation are you interested in doing (paint/carpet or fire/water damage or a specialty like foundation work)? What is your Exit strategy (hold, sell, rent)? What personal need will the achievement of an investment house help you meet?
I hope that as you explore this idea that you find my advice to be accurate and helpful.
