# True Foreclosures at Trustee Sales



## Nevada (Sep 9, 2004)

Having spent 2 1/2 weeks attending the trustee sale in Las Vegas, I'm in a position to comment on the process. You can get foreclosures at trustee sales, and *the trustee sale is the only place to get true foreclosures*. Realtors sometimes claim to offer foreclosures, but those are really foreclosed properties that have become bank owned repossessions. A bank owned REO (Real Estate Owned) property is technically no longer a foreclosure, since the foreclosure process is complete. You will typically pay twice as much for a bank REO as you will pay for the same property at a trustee sale.

Foreclosures aren't for everyone. First, you need to be in a position to pay cash. In fact you need to pre-qualify to bid at the trustee sale each morning by presenting a cashier's check (payable to yourself) in the amount of your maximum anticipated bid. For example, if you wish to bid up to $50,000 then you will need to have a cashier's check in the amount of $50,000 with you. If you win a property auction you will turn that check over to them and sign a power of attorney, then you will receive a check for the difference in about 2 weeks. For example, if your check is in the amount of $50,000 and you bought a property for $35,000, they will include a check in the amount of $15,000 when they send you your deed.

The other problem is that it's very difficult to research properties for the trustee sale. The main reason is volume, since about 500 residential properties are sold each day at the trustee sale in Las Vegas. Researching that many properties each day, plus attending the auction for 4 to 5 hours is impossible. You will need to narrow your search by zip code and try to avoid spending time on properties that you don't think you want or can't afford. I also eliminated all condos from my search. I developed a method for doing that. 



I only researched certain zip codes and certain sized homes.
I only researched properties within a certain maximum "estimated bid" amount.
I used Google Street View to look at the properties online.
I visited the county assessor's web site to get the floor area, number of bedrooms & baths, and the age of the house.
I visited the county recorder's web site to see if there were any liens.
Alternatively, you can go through a service that has a crew of about 60 people researching trustee sale properties every day, and even bidding for you, but they charge a fee for that service. If you are interested in a service like that PM me and I'll steer you in the right direction.

You will need to attend the auction for a few days to get the rhythm of the thing. They talk very fast, selling each house in about 15 seconds, unless there's a lot of bidding. The properties come to auction in no particular order, so you need to listen carefully to each offering. The auction is held outside in front of a building in a parking lot, so you will need to bring your own lawn chairs. A laptop is helpful to view the property offering spreadsheet and your research notes, but you could print that information instead.

The benefits in buying a property at the trustee sale are very good. Simply put, you can find properties for about 1/2 market price at trustee sales. However, there are risks; in that some houses can be copper-striped and otherwise vandalized in ways that might not show from the outside, and lien research is critical. The previous owner or a renter is still living in the house about 80% of the time, and it will be your responsibility to get them out. As I said, foreclosures aren't for everyone.

If you have any questions about how trustee sales work, just ask. I can't promise that it will work exactly the same everywhere, but I can tell you how it's done in Las Vegas.


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## edcopp (Oct 9, 2004)

Pretty good explanation for Nevada. Problem is there are 49 other states with upwards of 3,000 counties. The system varies from state to state and even from county to county.

For instance in my county I need to put up 10% the day of sale in cash or cashiers check. The sheriff in my county is content for me to go to the bank after the sale is over and get the funds, bring the money to his office the same day, and thet's good enough. I am known in my county.

Next county in any direction will be a bit different.


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## Nevada (Sep 9, 2004)

edcopp said:


> Pretty good explanation for Nevada. Problem is there are 49 other states with upwards of 3,000 counties. The system varies from state to state and even from county to county.
> 
> For instance in my county I need to put up 10% the day of sale in cash or cashiers check. The sheriff in my county is content for me to go to the bank after the sale is over and get the funds, bring the money to his office the same day, and thet's good enough. I am known in my county.
> 
> Next county in any direction will be a bit different.


They handle tax sales pretty much the same in Nevada, but the treasurer's office does it. I know that the sheriff used to do tax sales in Ohio when I was growing up, but they didn't get involved in mortgage defaults -- only tax sales.

This is strictly for non-judicial mortgage foreclosures of a trust deed. The county government has no reason to get involved in Nevada, but you may not live in a trust deed state so judicial foreclosures are necessary. I've read that there are still a few states that don't do trust deeds and non-judicial foreclosures, South Dakota is still one I think.


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