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Hello,
I need a little advice. There is a house in pre-foreclosure in our area that we would like to purchase and lease out but not to the current owners. They lived there about 4 months and abandoned the place, I would be surprised if they made any payments. The hearing is in about 10 days for the owner then the house goes to auction in mid October. Is it best to let it go to auction or try to purchase before then? The house will need some work but not to bad, the cleaning part would be the worst. I do not think there is any equity in the house. Any help would be great...Thanks!

I'm a novice, but I would think it couldn't hurt to see if you can make a deal now. Just know how much you are willing to spend and make your offer before it goes to public auction -- you'll probably have competition in that setting, so if you can secure the property before it is tossed to the wolves, do so.
Thought I'd chime in w/ my 2 cents.

Go to the county recorder's office and see how much the mortgage(s)are. If the mortgage(s) are for more than the home is worth, you would have to work with the homeowner and submit a short sale offer. Many banks are accepting short sales, but they do take time.
However, if you let it go to the sale in October, any junior liens on the property (like a second mortgage, home equity loan, anything else other than taxes) will be eliminated. once it is bank-owned, the bank may offer it at a low price. This will take time for the bank to work it all out, but its no effort on your part. However, once it comes on the market, there may be more competition.
Good luck and let us know how it works out!

Isn't it always the best approach to find assumable underlying mortgages that can be purchased to reduce or eliminate the owners worries regarding the foreclosure prosses? If a mortgage can be paid off by market _base_d rents, negotiating with the owner a purchase price/terms that can provide cashflow is the _object_ive, right? I am unable to qualify for any financing and my approach has to be one that circumvents any new loans through "normal" channels anyway. Any property with little or no potential for immediate equity would mean....? I have to keep looking for that situation that will allow for me to create financing that will satisfy the distressed owner as well as myself. Finding investors or flexible owners is my only recourse...Am I right????

Make sure that you do your market analysis and find out what it's current worth is. You can't do anything unless the owner gives you permission to deal with with bank. The bank will not begin to talk with you unless you have authorization from them. If you can get authorization, then you can offer the bank what you are willing to pay. I suggest offering 30% less than its current value. This will give you instant equity to fix the property up and sell at retail- if you wish to do so.