Ready to go through the home buying process without an agent? Believe it or not, you’re not alone. With technological advances, more and more information is at your fingertips. The data and resources that were once reserved for real estate agents and professionals only are now available to us all, enabling more investors and buyers to take the plunge on their own.
Whether you’re working with an agent or not, the property purchasing process is the same. The only difference is that you’ll have to do the legwork on your own. But don’t worry, we’re here to guide you through it. You did your research, found a property and already did your due diligence by researching liens, claims and titles—ideally with the help of a real estate attorney. And, you’ve already placed a bid, so what’s next?
The type of auction (REO, Foreclosure, Short Sale, etc.) and condition of the property will play a major part in determining whether you can finance the house through a typical mortgage or if you will need to be prepared to pay via cash/hard money loan. Ideally, you’ve done your research and have available funds before bidding. If that is not the case, make sure this is at the top of your list. In the event that your bid is selected, you must be prepared to pay for the property. Each auction, whether online or in-person, has its own process, but you’ll usually have a short timespan to submit the payment. If you are unable to pay within the time limit, you could lose your deposit, be hit with additional fees and be banned from future auctions.
Keep in mind, if you’re purchasing the property under an LLC or a separate entity, you will have to provide the necessary documentation.
Keep in mind that most properties at auction are sold as is. However, if the property is vacant and available for viewing, it’s highly recommended to inspect it before bidding as an inspection will expose the true state of the property. Through a thorough inspection, you can uncover issues that may not be apparent, such as the condition of the property’s plumbing, structure, heating & electrical system and more. An inspection will help you estimate what you’ll need to invest in the property post auction.
You may not be able to inspect occupied or foreclosure properties before bidding. However, you are able to research these properties on Hubzu and view property descriptions, photos, purchase history and rental estimates provided by RentRange. Although buying properties at auction involves certain risks, make sure you do not ignore this step. It can help you avoid any unwanted surprises.
GET THE DEED
Post purchase, your title/closing company will usually be required to record the deed with the county of purchase. This serves as evidence of transferring the title to your name and represents your right as the owner to claim the property, making this an essential step. Be sure to check your state’s requirements, as rules and regulations can vary by state.
It could take days to weeks to receive your title but remember, the property is not legally yours until then.
The process to gain physical possession over the property will vary depending on the type of property you’ve purchased. If you opted for a vacant, unoccupied property, you’re free to enter the property once you have the legal right to do so. If you purchased an occupied property, you’ll likely want to consult with a real estate attorney for assistance in either vacating the property or creating a new leasing agreement with you as the property owner. Once the property is vacant and you have the legal right to enter, it’s all yours! You can change the locks, inspect the property and start renovating as needed.
RENOVATE & MAKE IT YOURS
After making the necessary fixes from the inspection findings, start making any other updates you’d like. If you’re looking to fix and flip or rent the property, start modernizing the space. If you’re hoping to live in it, give it the refresh you personally desire. Before you know it, you’ll start reaping the rewards of a profit from reselling, monthly rental income or a new home to call your own. Congrats!