fbpx

Hat tip to clearfund for sending this in, from businessinsider:

Foreclosure buyers, the trash collectors of the housing industry, have been raking it in.

An anonymous foreclosure scout recently described the “ins and outs, all the dirty tricks, blatantly illegal practices” in a thread at Reddit. In fact as the thread became popular, the source deleted his comments out of concern that his identity would get out. His answers were preserved, however, at Pastebin.com (via Patrick.net).

We’ve picked out the highlights, edited for clarity. We can’t verify the identity of the foreclosure scout, but he sounds legit to us.

1.   “Before you go to auction you need to actually scout the houses. It’s common for previous owners to gut the house or completely remove the kitchen. It was my job to drive to these houses and assess them, damage, repairs cost etc… Part of this was getting into the house which were many times locked, so we would break & enter all day, every day…

“Many banks will change the locks once the previous owners have been evicted but they only use 5-6 different locks. Somebody in my company somehow obtained copies of these keys which we kept with us, allowing access to many houses that would be too secure for other people to get into.”

2.  “If you could gain access, a lot of times we would try and block as many windows and secure the house as much as possible. If I could block any view of the kitchen, other competitors will have to assume another 10K in cost because they cant verify an intact kitchen…”

“I would keep a bunch of old padlocks with no keys. If the garage was unhooked from the opener I could get in, padlock it on the inside and then when I left, I could walk out a back door locked from the inside. Essentially, removing the garage door as an access point. We would also put locks on side gates as well. If the other companies were using older guys to scout, they wouldn’t bother jumping the fences.”

3.  “Sometimes with the little amount of time between scouting houses and and auctions, you can’t get to the bank to get actual certified checks. Before you can bid on any house you have to show your cash or checks to the auctioneer so you can’t overbid.Certain people would develop relationships with the auctioneers where they would show fake photocopied checks. If you won the house, you would just meet up with him later to pay, as well as give them a tip.””Most high rollers would “tip” auctioneers, my company would actually write it off on taxes as a “tip”. If we won a house we would meet up later and give the auctioneer a few hundred bucks. Now nothing was ever discussed about asking the auctioneer to do anything illegal, but when it came looking past not having money on the spot or saying “going once going twice sold” really fast and maybe not listening too well, the tips came in handy.”

4.  “Go to auctions and hang out, half the game is actually buying the house and competing for the high bid. The atmosphere is a lot like that show “Storage Wars”, but you are dealing with WAY more money, though the biding techniques and rivalries are similar. For example, if big players are avoiding a property that appears like a win, there is obviously something you have overlooked… IRS Lean? Inside is trashed? Something screwy with the banks or the loan?Knowing the actual status of the title is VERY important, nothing is worse than seeing somebody buy a 2nd loan on a house. Essentially, he bought a loan, but not a house. Another example is a random guy who showed up, paid cash for a house that we knew had major sewage problems. If he planned to sell the house he would need to do 40K in sewage lines under a major highway, the guy basically [expletive] himself but walked off smiling from ear to ear.I guess what I’m saying is, if you want to buy a house at auction then take some serious time doing homework and learning the ropes. 95% of newcomers are gone after 1 or 2 houses because they are broke or made simple mistakes. I’d just try and find a short sale from the bank.”

Read more:

 

(Hat tip to David for the photo wearing his bubbleinfo t-shirt, which is now among the top-10 google images for ‘trustee sale’!)

Pin It on Pinterest