Yesterday, February 2nd, 2010 was Black Tuesday, First Tuesday of the month, otherwise known as Foreclosure day. I attended my first auction in Travis County outside the courthouse on 1000 Guadalupe. There were about 100 people who attended this chilly and drizzly morning. With my nephew in tow (he really isn't that young, only 9 years younger than me but has 8 years more real estate experience than me), we arrived at 9:50 am just a few minutes to get acquainted with the process.
There were 3 folding tables in there, one table was marked Flsonline, an online foreclosure listing service who provides lists of upcoming foreclosures. There were providing free handouts. One table was handing out free lists of tax foreclosure, were 10 homeowners were scheduled to lose their home due to non payment of property taxes. The other table was Wendy Alexander's table, an agent who represents a bunch of big name banks who at exactly ten am started to call off several properties to auction off.
At ten am, the crowd still stirring chatting in small groups continued to chat at the top of their voices as this tiny lady, Wendy, called off the first property, the homeowner, the legal description of the property, the lien holder, and a bunch of legal jargon and mortgage amounts, then a man yelled out a number, then another woman yelled out another number, then Wendy continued to speak. The only sensible words I got from Wendy were "Are there any bids?" then no one responded and she quickly mumbled something then continued to the next property in her list without taking another breath and then the whole jargon started all over again. The 2 number yellers where representatives of 2 firms that provided the foreclosure lists, FLSOnline and Real Estate Foreclosures of Travis County. They were calling off the respective item numbers from their catalogues that you would have previously purchased before the auction. I paid for my 40 page booklet for $5.00.
The most interesting part of the morning was when the bystanders actually started calling off prices after Wendy asked for bids. An example of a bidding war was this home on Richmond Ave. in the 78748 area code of South Austin. Wells Fargo held the note and Wendy called off an amount that sounded like $99,000, an amount the bank was taking the home back for, then the bidding war started and ended at an amount which was $136,000. The tax assessment on this home listed at $234,563. You do the math, the winning bidder just had a $100K instant equity on this home. I wonder if the winning bidder did his due diligence before hand and searched to make sure there were no additional liens and that the property did not require a substantial amount of repairs? Assuming that he did his homework and there weren't any, I still like the end result which was a whopping $100K deal. So it appears, if you have the cash, patience and ready to partake in a bidding war, deals are out there.
At about 11 am, after Wendy finished, packed up and left, small groups formed and other agents which looked like lawyers started auctioning off HOA foreclosures, and other properties I have yet to figure out. Some lawyers just stood and mumbled as they read legal jargon.
Now, the sad part, the list I purchased from Real Estate Foreclosures of Travis County stated in this 40 page booklet that there were 695 properties auctioned off, a total amount of $507M or $216M in tax assessments/appraisals. WHOA!
Read the 2 statistics reported by Real Estate Foreclosures of Travis County. January 2010 so far is reported 809 foreclosures!!! Right after Christmas, 809 homeowners lost their homes. My heart goes to all these homeowners. Have any of you heard of short sale?
If you wish for more information about Travis County foreclosure sales, please visit this site. It has an explanation of the bidding process etc. I plan to attend March's sale event again and hope to learn more. It will be a while before I partake in the bidding war, I guarantee.
