Title and execution searches

[farrouk]

Could anyone comment on which methodology works best. I realize the importance of conducting these searches but at $100 a pop it can get expensive on each bid.
Does anyone do the searches only if you win and take a chance. I would hate to walk away from a deposit but it seem like its just about impossible to win these sales. If you win one in ten that you bid on. I can't see the chance of getting burned as being that high.

Comments

[worldjohn]

I know exactly what your mean.  If I'm very serious about a property and about bidding to win, then I'll do a title search first. (which I dont really do anymore, too many people bidding high, too many crappy properties)  If Im just putting in a low bid for a long shot then I dont bother with the searches untill after I win.  I've won twice with low bids and havent got burned yet.

[Pfm1011]

I personally get as much info as I can for free, then if I am semi interested I pull a $29 summary and look for obvious hand grenades.

If none are found and I still want to proceed , I then order the full title from ontariotaxsales. I also order a back up one for $70 for the morning of the tender if I get a nasty feeling from the owners   So essentially every bid runs me about 130 and 10 for draft and 20 FedEx. Not including time I'm out around 160 to 230  total per bid. To date I have lost less then half of my bids as I don't chase ones I know will be stupid..IE the Toronto property a few weeks ago or cottages up in Muskoka's. and I don't super lowball hoping to win a lottery.

Even If you have to walk from one deposit it will equal a minimum of 30 or more title searches ( or 2 , 3 or 400  in some cases) so not doing titles just because you lost two or 3 bids is "penny smart , pound very very very stupid."

Even if you win 1 out of 20 or 30 . The profit from the win will easily exceed the cost of performing  due diligence

[Sasha]

I've done a title search at land registry offices at a cost of $8 to $25 (depending on the municipality), sometimes executions may be done at the same place.  Not a lot of money.  If you do a drive by, you're near the land registry office anyway.  It'll cost you if you decide to see a lawyer before actually winning a bid.  If you do the work that you're able to yourself, it shouldn't cost very much.  I think it was Dave that said that the drives are actually an 'outing'.  I'm planning to drive to Sioux Lookout this Friday, 3 hour drive, take my fishing rod with me.  If I'm really interested, I wait till a few days before the sale (in case its cancelled) and then order title and execution from ontariotaxsales.ca

Sasha

[twinn1]

I would never commit to any tax sale without first doing some due diligiance.  Usually I wait until about a week before the sale then will go and visit the property and do the title/exuction searches at the same time.  How could you bid on a property with out doing a title search? Lets assume that you see a tax sale for $5000(very rare now a days) you bid $5000 and put down a deposit of 20% $1001(add the 1 just to make sure it is more then 20%, thanks Frank for this tip). the property has a lien on it ,you now just lost $1001, you could have potentially done due diligance on 5 properties with that.

As far as a business transcation is concernced, $200 is not a alot of money to put down considering that you will be investing some big money into the property.  Assume that you want to buy a car for $30-40K.  First you would probely do some research, sign up to consumer reports for their reviews($20), maybe buy a book or two ($40), drive to a few dealerships and see the best deal you can find($20 gas), mayeb check out some US dealerships($50 gas) check a few websites for reviews of the car.  You are looking at spending $130 on just research for a car and thats not counting the hours spent online researching.

I'm sure that I have spent over $1000 on various tax sales on gas and due diligance and I have yet to win one, its all a part of the game.

[worldjohn]

On my first bid I spent $250 (searches gas motel) only to have it redeemed the day of, as well, I would have come in third.  Now I get all the free info I can and take a calculated risk. what percentage of properties have crown liens?? maybe 5% and half the time those are listed. A bigger concern is enviromental issues maybe 10% but again half of those are listed as such and other sources of info like this board reduce the danger even further. I can live with that risk, some people can't.  I go to casinos some people wont.  anyone think differently of my numbers?

[speedfreeksteve]

Personally, I try to find out what I can for free and follow a few rules:

#1 Never, EVER approach the current owner or their immediate neighbours - that could jeapardize things in a number of ways

#2 Check comparable local properties before you bid. I've all but given up bidding on anything in "cottage country" since there's too many people out there overbidding on everything just because its a tax sale property instead of bothering to look in the local paper or mls to notice what a property is actually worth. The last half dozen tax sales in cottage country were just silly.. I think the 3rd highest bidder would've overpaid an equivalent mls listing in any of them.

#3 Don't talk to local real estate about the property. It's fine to talk to an agent, but don't spill the beans about a property that might go for cheap. They're the first ones that will buy it and flip it.. or tell their friends to buy it. They know the local market.

#4 Try to hold off on putting your bid in or doing a title search until a few days before. Check with the municipality a few days before if its been redeemed yet. Half the time it has been. You can waste alot of time and money researching and bidding on something that ends up redeemed. If you totally love a property then disregard this one and take the extra time for due diligence.

#5 Ok not a rule.. mostly advice.. these days you can often get a free property package either online or with a polite phone call to the municipality.

[Larry]

These seem pretty good rules.

Just learning here,
Larry

[Pfm1011]

#1 Never, EVER approach the current owner or their immediate neighbours - that could jeapardize things in a number of ways

Almost every sale there is someone on here " I was talking to the neighbour..bla bla bla"    I  just wish I could hit people with baseball bats thru the internet

Don't talk to local real estate about the property. It's fine to talk to an agent, but don't spill the beans about a property that might go for cheap. They're the first ones that will buy it and flip it.. or tell their friends to buy it. They know the local market.

You might as well ask a Great White shark if the lagoon is safe to swim in.

[worldjohn]

those are great rules and should be repeated often so people finally get it. but I think the original question, was about the necessity or lack thereof, of doing searches on every bid.  My answer is that if you're going to do a lot of bids then take calcualted risks, if just a few bids a year then do the searches. Some will disagree, but thats worked for me.

[markymark]

does anyone know how to do searches from home?
i tried and only found courses(USA)
go back to school maybe?
would geowarehouse show title and deed info?if so i may take the $3000 plunge.
as i've doubled that in fuel and searches so far and still newbie.
$29 pkgs sound great.
thankinya inadvance
marco

[Pfm1011]

No deed info, you can order summarys only which still means detailed searches on any bid