In an effort to expand his part-time real estate investment gig into a full-time career, Joe came to me for advice. Needing more leads on below market value properties, he was specifically interested in how to buy abandoned houses in Chicago. Joe had seen several of them just driving around town, neglected and boarded up, and thought there must be a way to grab a few. There is, I told him, if he was willing to put in the time and research. To give him a head start, I agreed to go over the steps for getting these cheap Chicago properties and to direct him toward what I use to source leads.
The Steps to Buying Abandoned Houses in Chicago
In Chicago, residents are encouraged to report abandoned and vacant properties to City Services by dialing 311 or visiting the City of Chicago’s website. The idea is to help the city enforce building codes in order to improve the safety and living conditions for everyone, not just those residing in some of the more run-down neighborhoods. These houses are often times in substandard condition and dangerous to even enter, not to mention being a blight on neighborhoods and property values. With the help of the community, they can be identified and, hopefully, rectified.
Acquiring one of these houses to rehab can turn into a lengthy, grueling process, especially since not all vacant and neglected homes have been abandoned. But for real estate investors who are flipping houses in Chicago, the effort can seem worth it. The homeowner, if living, may be willing to sell below market value. If they are deceased, it’s still possible to buy. So let’s take a look at how you can find out about a property’s status and what you can do to potentially get an abandoned house.
- Research with the city. Whether you find an abandoned property by driving by like Joe, through a Google search, or off of a lead list, your first step is to check to see if it is already owned by the City of Chicago. Two websites, in particular, City-Owned Historic Buildings for Sale and City-Owned Vacant Land, will list houses owned by the city and the guidelines you’ll need to follow to purchase them. Buying city-owned property is not always easy, mind you, but it can be easier than tracking down an absentee owner.
- Research with the county. When the property you want to buy is not owned by the city, you’ll have to dig deeper to find the owner. Visiting the Cook County Property Tax Portal and the Cook County Recorder of Deeds are your next steps. These sites provide online access to property records and any information available on the last known homeowner. Unfortunately, this data—particularly contact information for the owner—is frequently outdated. This doesn’t necessarily mark the end of the road in your search, however, only the need to expand it.
- Research public databases. If you don’t find enough info with the county to contact the current homeowner, you may have to enlist a paid service to assist with the research. There are a number of companies that cull public records from local, state, and federal agencies and make the data available to anyone for a monthly or yearly subscription. Because they pull records from multiple sources like credit union applications, voter databases, and driver’s license registrations, these services can be helpful in locating a homeowner where the county was not—for a price.
- Research the court. It’s possible your search for the homeowner won’t turn anything up, which means they may be deceased and the property has been willed to a new owner. The Cook County Circuit Court provides information on wills and probate cases that can direct you to the heirs. If there are no heirs, and the house has not been transferred to the state or local government, you can petition the court to have the property escheated. The process of escheatment, in which the state takes ownership, has to meet certain conditions though. The property must be abandoned and the owner deceased, with no will and no lawful claims made by family members, for seven years. As long as you’ve asked for a writ of possession and filed your intent with the attorney general’s office, after seven years, the property could become yours.
- Research the property. If you’re lucky, however, and find the homeowner alive and well, take the time to confirm that the property is the best real estate investment you can make with your money before reaching out. The reasons the house is abandoned might be reason enough not to buy. Check for back property taxes, code violations, liens, existing court cases, and whether permits have already been filed, approved, or denied for a rehab. Each of these will have to be remediated, and you’ll need to contact both city and county offices to uncover every probable hindrance to the sale and renovation. It’s also a good idea to check with the Department of Buildings to determine if the property is being absorbed into Chicago’s Forfeiture Program, which has its own rules and regulations for purchasing.
- Contact the owner. This final step may seem like the easiest one to take, but tread lightly. Buying distressed homes from owners who’ve abandoned their properties takes as much patience and persistence as it does money—potentially more. Whatever prompted a homeowner to leave a property in the first place likely created an emotional hardship in addition to a financial one, and you’ll be forced to deal with both if you want to convince someone to sell. You’ll also need permission to inspect the property thoroughly to ensure you’re not offering to buy a house that is prohibitively expensive to renovate. You don’t want to get anyone’s hopes up or buy a money pit. Compassion and tact, and a good home inspection, can take you a long way.
On the surface, buying abandoned property in Chicago can look like a great way for grabbing good deals, as it did to my friend Joe. But, as you can see, once you do a little digging you find it gets complicated, and potentially costly, to build your portfolio with these homes. Thankfully, there’s a much simpler strategy for buying and renovating properties acquired from distressed homeowners and it starts with one easy step: becoming an independently owned and operated HomeVestors® franchisee.
A Step Up for Buying Distressed Homes
HomeVestors® investors are able to sidestep much of the drudgery associated with finding motivated sellers by having access to one of the most sophisticated real estate investor lead generation systems available. This system, supported by advertising through print, radio, and television, connects distressed homeowners across the nation with local independently owned and operated HomeVestors® franchisees able to help them out of a bad situation before it gets worse. In fact, the nationally-known “We Buy Ugly Houses®” brand has helped make these connections—and improve property values, homes, and lives—since 1996. As a long-time HomeVestors® franchisee, I’ve been able to do the same for almost as long.
After our chat, Joe decided to change direction, call HomeVestors, and let the leads come in by taking advantage of the “We Buy Ugly Houses” marketing campaign. Thinking about abandoning your old ways of buying, renovating, and selling houses? Then I think you should do the same.
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