A friend of mine from out of state was recently visiting us in Maine. It was the first time he has been here and he kept repeating one word: rugged. He wasn’t prepared for the denseness of the forest of the ferocity of the coast. He wasn’t prepared for how salty and hardscrabble things can be.
We take a lot of pride in that, but we also know what that means. Maine is a place where there are tough times and a good amount of fluctuations in the market. That means there are distressed properties and foreclosures.
This creates opportunities for those of us in real estate investing. There are many ways to find real estate investment opportunities, including buying up foreclosures or helping out homeowners who are looking to sell before that happens. If you are thinking about the foreclosed homes market, in Maine, you are most likely looking at sheriff sales.
Comparing sheriff sales in Maine for the best investment property options is a smart thing to do before starting. These have some opportunities, but also a lot of risks—and knowing those risks going in can save you a lot of time and money.
Comparing Sheriff Sales in Maine
We probably all know about how to find foreclosure auctions in the more populated counties of Maine—Cumberland, York, and Penobscot, to name a few. But some of the smaller ones also have sheriff sales that may provide deals. Here’s a few on my list:
Washington County, Maine Sheriff Sales
With a population just a little over 30,000, Washington is one of the smallest counties in the state. It’s home to a lot of fishing communities, which can struggle or bloom depending on a number of factors. That means there are always homes that are foreclosing, and people coming in to try their hand at buying them. After all, this is the county that sees the first sunrise in the U.S. every day. It’s a place of hope.
That said, there aren’t always a lot of foreclosed homes actually for sale—and it seems even more risky from there. A recent Washington County sheriff’s sale had a total of four homes for sale, with one of them canceling. There were a pretty good range of lower-end price points, with minimum bids of $28,000, $44,000, and $76,000 based on an appraised value, but that’s not where the bidding ends. You see, this particular sheriff sale allows banks to bid first, setting the bar so you can’t afford it and they can potentially buy the property back. You’d have to be pretty brawny to enter that contest.
Hancock County, Maine Sheriff Sales
Hancock County is what people think of when they think of Maine. It has the longest coastline of any county in Maine, it’s home to the famous and beautiful Acadia National Park, and its economy is dependent on fishing and tourism. Those are both risky.
The sheriff sales don’t happen regularly in Hancock County, which means you have to be able to act quickly when they do, and regularly check with the sheriff department—a task which not everyone finds fruitful. There is generally a higher price floor in this county, but that also often means a higher ceiling. This is a place where people want to move, so you’ll have to be able to move fast.
The Risks of Sheriff Sales in Maine
So why wouldn’t you want to find homes with a sheriff’s sale? Well, there are a few reasons.
- There is a lot of competition. Everyone in the industry uses sheriff sales. And in smaller counties, where there aren’t as many homes available, that means a lot of hands reaching for the same brass ring. That can easily drive up prices, and, just as bad, make you spend time for nothing.
- The bank bids first. Did we mention that, in some places like Washington County, your first competition is going to come from the banks? Banks are allowed to bid before any investor, which means that the price floor is already going to be higher before you have a chance to step in. It’s a quirk of the law that makes it that much more difficult for an individual investor to have a chance.
- You usually can’t inspect the homes. One phrase you’ll see at a lot of sheriff sales is “The appraisal may or may not have included an inside inspection of the property.” That’s…not ideal. You just don’t have all the information you need to make an informed decision on how much work you’ll have to do. You won’t have an estimate of the costs to repair the house in order to bring it back to market. And, that can get you in trouble.
- You might be on the hook for a lot of bills. Again, without all the information, you could find yourself on the hook for liens or overdue bills.
- You don’t always own the house. You can put down a 10% deposit but, in many counties, the original owner can come back and get their home back. In some counties, you get your deposit, but you might have to fight for it. In a business where liquidity is key, not having that money might mean passing up a great deal (unless you find a good hard money loan in Maine).
- You can get in legal trouble. If you run into trouble one month and have difficulty paying the remainder of the house, you have stolen from the sheriff’s office. You could potentially face jail time for contempt of court. That’s not ideal!
So, there are a lot of risks that come with sheriff sales in Maine. But is there a better way?
A Better Way To Find Qualified Real Estate Leads in Maine
There are definitely opportunities for buying foreclosures in Maine, even in small counties. But before they go to foreclosure, they are distressed properties owned by motivated sellers. And as an independently owned and operated HomeVestors® franchisee, I hear from them first.
See, people with distressed homes are looking to sell. And since 1996, HomeVestors has been a trusted source for buyers like me who can help fast. The homeowner, remembering the nationally-known and trusted “We Buy Ugly Houses®” ads, contacts us. Then I get in touch with the seller. It isn’t a cold call.
This way, I generally get to talk to owners before they are foreclosed. I can inspect the house, and make a quick offer. I’m not competing with everyone, and I’m not in an auction. I make a fair offer and the seller gives a reasoned response.
If you’re interested in getting qualified leads in Maine, request information today.
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