Love the flip threads! Thanks for taking the time to share with us.
I love following these threads especially since I live in San Diego too! Good luck today!
3 Foreclosure Auction Property
Well, I got there early and was able to ‘register’ and ‘qualify’ (show them the cashier’s checks) with only 5 bidders standing there. Auction started at 9am and they called all the postponements and then I got excited because my property was still active and ready to be sold!! Rarely happens. Next thing you know, there’s about 20 bidders showing up and there were 5 active bidders on the property I wanted. The bidding just blew right past my max bid and I was shut out by about $50k. Oh well, rush back to the bank and deposit the money back. Same old story for my tries at the auction.
Meanwhile, one of the auctioneers recognized me from a long time ago and came over and chatted. That caused 4 newbies who just do not understand how auctions are run and they rush over and start asking me “Where can we get the list”?? I have to explain to them that there is not one list anywhere, you have to work hours assembling a list of properties that are going to auction from various trustees and auctioneers. OR you pay for an expensive subscription to a fancy website that has all info in one place - which is what I do. Then I can work everything from their website and create a custom list to print out. That is what most professionals do - we all use the same website.
Here’s the details:
2274 Caminito Pescado #35, 92107
3 story townhome, 2 car garage on bottom.
2 bedroom / 1.5 bath - my agent and I researched hard last night and discovered it only has 1 1/2 baths. But there is a recent sale in complex at $425,000 so we knew we could get a quick sale at $420,000
It is owner occupied and buyer will have to gently get the owner out of the property. Owner has not paid 1st mortgage for about 2 1/2 yrs. Somehow the owner got a $50,000 2nd loan at the beginning of this year - which she obviously did not use to pay mortgage arrears or HOA delinquency! That loan will be wiped out by the foreclosure of the 1st mortgage. And, owner has not paid HOA monthly fees for over a year and there is an HOA lien on the property also. There is also an Abstract of Judgement for about $8,000 from Capital One which is probably credit card default.
My max bid was going to be $307,000. Bidding blew past me immediately and ended at $355,000. I recognized the two final bidders going against each other. They are big pocket investors who hire kids (well, they look like kids to me, probably in late 20s or early 30s) to stand at the auctions and bid for them. These kids have phones glued to their ears and just take instructions during the actual sale. Otherwise, they sit there all morning.
I’m going to watch it carefully to see how long it takes to get owner out and what they do with the property. I’ll keep you posted because buying properties at auction are very interesting. Lots of crazy awful things can happen, especially if you are trying to get occupants out of the house. I know an investor in the Los Angeles area who has been trying to get a squatter out of the property for over 4 years.
Trying to get occupants out of a house doesn’t sound like fun to me. Looking forward to the next prospect.
Yeah, between getting the owner out of the property and having to pay the back HOA fees, I think it’s lovely that you didn’t get this.
cb, stop being so damn helpful to your competitors.
The HOA doesn’t get paid back in a foreclosure. There was a huge court case many years ago about this. By law, liens are placed on a property in the order they are recorded. So, if you purchase a 1st Trust Deed/Mortgage at a foreclosure auction, all liens that are recorded after the date of that mortgage are ‘wiped off’ the property. They are not technically ‘cleared’ off the owner personally, but good luck trying to collect from someone personally when there is no more collateral attached to the HOA lien or HELOC or 2nd mortgage.
HOAs were trying to blackmail/extort from buyers that purchased foreclosures by trying to get them to pay the back fees owed. Even worse, they would hold that buyer hostage if they were an investor that tried to sell to a new buyer. When an owner goes delinquent on HOA fees, the HOA only has recourse to record a lien against the property for amount owed. Usually these liens are recorded long after the owner’s mortgage date and are wiped out by foreclosure of the 1st mortgage. So, they legally cannot charge a new buyer for arrears.
I have purchased several condos in foreclosure and, believe me, they try to make your life miserable when you try to transfer ownership at their management office. There are suddenly a lot of ‘transfer’ fees charged because they just get all flustered if you purchase something outside of escrow (because they like to charge a lot of ‘transfer’, ‘document’ and ‘key’ fees through an escrow). They sit there and just cannot figure out that you suddenly own this property… “Why weren’t we notified? What escrow company was it?” “We didn’t authorize this transfer”. Uhhhh, you have no right to ‘authorize’ a legal transfer of property. It happened… and now I am the new owner. No, I don’t need to pay $125 for the set of HOA and CCR docs, I copied them at the Recorder’s Office.
Regarding the competitors (newbies)… they were trying to quiz me about what contractors/subs I use, which areas of San Diego do I focus on and all kinds of stuff. I draw the line there and let them know that I really cannot share that type of information because it is a very competitive business.
4 Shortsale in La Mesa
A new listing came up in La Mesa for a house where owner has gutted it out and got caught by City inspectors. And, they are under water on their mortgages. And, they have State Tax liens on the property. A big mess.
I walked the property Friday afternoon. The listing agent was there with 2 other interested parties and he couldn’t even give me the time of day (I don’t look like the contractor type, he cannot be bothered). Interior is gutted with all kinds of walls removed, improper beams, etc. Exterior in poor condition, pool covered up, Mexican tile roof with holes in it. I peeked under pool cover and the pool would need refacing/refinishing, new tile and new systems.
On top of the poor condition of the house, there are about $60,000 in liens on property. Because it is a short sale the buyer would have to pay the liens off to get clear title. And then you get to start dealing with the City of La Mesa because they have Code Compliance against the construction underway. Whole can of worms.
I would go for it, but the numbers are not working. Evidently there was an offer of $350,000 made into the bank for short sale approval, and the bank came back with a minimum $380,000 for it. I decided to pass on this one because the listing agent wasn’t taking me seriously anyway.
10011 Sunset Ave, 91941
Doncha hate that? It’s like being female while being a business person. They just don’t get it.
Reminds me of car shopping with H. I was the one who wanted a more powerful engine and a stick shift. They couldn’t wrap their heads around it.
5 Upcoming
I am working on several ‘pocket listings’ where I know about properties in Point Loma area that will be coming up for sale in the near future. First one is a property owned by heirs and they are trying to clear it out and get it ready for sale. They are planning to put it up for sale in January and I have been talking to the listing agent. I’m following up again this week to see if I can make an offer before it is listed in the MLS. It’s a large house and may go for more money than I can scrounge up.
6 Upcoming
I have been contacted by the listing agent that sold Nipoma Liberace House. He has a listing coming up in January. Very old 1937 house that will need a lot of work. Owner has been moved out to Assisted Living by their family but the 50 year old son is holding out in the house and sisters are trying to get him out so they can sell the house. Then he said they will need to ‘clean it and paint it’. I told him that anyone buying the house is going to have to rewire and re-plumb the house, so why bother with painting? I pushed him to let me make an offer ‘as is’ with a contingency to close whenever they can get the holdover tenant out of the house.
7 Upcoming
I find out about upcoming properties in the strangest ways. My father lives in Assisted Living nearby and one of the other residents has been holding on to her empty vacant house in Point Loma. I was talking to her about how I live in Point Loma also. She says her house is coming up for sale very soon, listed by her daughter in law. Of course, being Snoop Dog Snoopy… I figured out which house it is by searching public records. I am very interested in this house also, but I didn’t get too aggressive with the nice lady. I need to try to figure out who her daughter in law is so I can make a phone call.
It’s certainly a good time of year to scout out these possibilities! I was just looking at this tiny house; the listing is certainly upfront about the condition! http://www.sdlookup.com/MLS-150056000-4839_Long_Branch_Ave_San_Diego_CA_92107
This sounds very exciting. Do you have any concerns about getting the tenant out of #6?
I saw Long Branch come back on market this morning. I just personally don’t care for that dense area of Ocean Beach. It would be impossible to get some trucks in there for work.
No concerns about getting tenants out, especially for a regular real estate transaction where there are family members who want the proceeds and/or proceeds are needed to pay for the Assisted Living. They will make sure their brother gets out of the house. It’s different when it is a foreclosure… lots of horror stories about getting owners or tenants or squatters out of the house. I have a colleague up in Los Angeles who purchased a house through regular transaction and is still doing battle in courts to get an ex-boyfriend out … four years later. He has never even been in the house that he bought.
It’s an interesting story - ex boyfriend continued to squat in the house. First the ex-boyfriend tried to file bankruptcy (which didn’t affect anything because he was not on title for the property), then the buyer had to try to do an eviction. Finally the ex-boyfriend came up with the craziest scheme… he filed in Family Law Court that he was legally married to the Seller and, therefore, the sale was not valid because he was a joint tenant and did not sign the sale documents. So, the frivolous law suit lingered in Family Court waiting for hearings for 2 years. Meanwhile the legitimate Buyer proved, easily, that the boyfriend could not have possibly been married to the Seller because he was married to someone else at the time! Now he has to start eviction process all over again!!
This reminds me of a family we knew eons ago. Bachelor son lived with his aged father for decades in the very, very modest house, supported him, took care of house, made improvements such as installing modern plumbing, etc. Father died in his 90s. Brothers immediately put the house on the market, kicking their brother out of his home. If he hadn’t been living there, they would have had to sell out and pay for father to be in assisted living years and years ago and wouldn’t have seen a dime. They didn’t “need” the money, which wasn’t much anyway.
Maybe these sisters actually need the money…
I got the feeling from the listing agent that it was not the same type of situation. Grown son mooching off Mom for many years and the house is falling apart around them. Sisters had to move Mom out for her safety. He evidently has a ton of ‘hoarded’ stuff in there.
The listing @Marilyn posted in #31 sure needs some TLC.
So glad to see you’ve started a new thread!!
The house in #31 is just a midget property! It has the square footage of a studio or 1 BR apartment. Even if a second floor were added, the upside potential seems limited. Could it possibly go for that price?