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I Made $3,000 Helping Someone Avoid Foreclosure

by David in Texas   

I send out several postcards every month. And in Texas, November and December always seem to be the hardest months to buy foreclosure sales because the holidays and work weeks are so short.

A homeowner called me on Tuesday, November 21st--two days before Thanksgiving--about his home being foreclosed on and asked me to come look at it. It was in an area I really wasn't interested in, but I always take the approach that I'm doing this to try to help someone and make money at the same time.

I set up a time to go look at the home the day before Thanksgiving and right before I was to leave town. When I started visiting with the owner, I found he had already called about ten other investors, and every one of them had told him they were not interested because of the location.

After doing a quick run through the home, I felt it had potential of about $45,000 to $50,000, and the owner was willing to sell the home for what he owed. I did a quick "subject to" contract on the home for $30,000.

All businesses would be closed until the following Monday, and all my hard money lenders would be out of town until at least the Tuesday after Thanksgiving. I was leaving town that day and wouldn't be back until Saturday.

I told the seller that the following week would be very hectic, and time would be very short to try to get all the title work done and to get my money in place to close before the foreclosure. I stuck a sign in the yard, wished the seller a happy Thanksgiving, and told him to do lots of praying for us to be able to pull off this miracle.

I had no cell service while I was gone, but I got a message from a buyer who had called me on Thanksgiving Day. He had seen my sign while driving through the neighborhood, and he was interested in looking at the home.

To cover my bases, Saturday morning, I drove out to the home and called an investor I know who might be interested in buying for cash on a quick sale, and I returned the other buyer's call.

Turns out, I had several rehabbers/investors interested in seeing the home, and they would meet me to see the home sometime that day. The buyer who called me on Thanksgiving was extremely interested and told me over the phone that he would take it and asked me not to sell it before he got there.

I told him I had several buyers looking at it today, and the it would be "first come, first serve." (I've done too many of these over the years, and a call out of the blue like this just doesn't ever happen, so I thought) To say the least, he was there in ten minutes. I don't know how fast he was driving, but its almost impossible to make it from where he was at to the house in less than twenty minutes.

I already had one of my rehabbers/investors there looking at the home when he pulled up. He did a quick run through of the home, and wrote me a check for $35,000. Turns out, we had the same attorney, and he was trying to locate a property for his 1031 exchange on some other property he had sold.

We closed the following Thursday, and we gave the seller $2,000 for moving expenses and to help him get into a rental. Net was $3,000 for maybe six hours of work on a home that I didn't have time to look at and wasn't sure what I would do with. I probably could have made more, but $500 an hour isn't bad for a quick-turn I wasn't even sure I could finish before the foreclosure sale.

 
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