By Robert Griswold
Question: I can't possibly afford to pay the asking price for investment properties in my area, so I am interested in bidding on a residential rental property that is currently in the middle of a foreclosure action. The auction is on the courthouse steps in a couple of weeks. Where do I start?Property manager Griswold replies:
You need to thoroughly check out the property so you know as much as possible about what you are buying. Buying foreclosure properties in most metropolitan areas is a very competitive process fraught with pitfalls. I seriously suggest only the savvy and experienced real estate investor with the ability to absorb some bad purchases get into this area.
In general terms, you want to look for recorded and unrecorded liens and physical problems with the property. You should also read some books on foreclosures to understand the process and the specific laws in your state. One of the most important issues you need to resolve before making a bid is to determine what rights, if any, the involuntary seller of the property has to redeem the property or regain possession.
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