Before recounting my adventures in renovating the interior, I thought I would take a short break and talk about buying materials. My goal has always been to make this house look as good as possible for the least amount of money possible. That meant I have had to become a comparison shopper to say the least. I’ll search the internet for deal s when possible but most of the supplies would need to be found locally. I would usually start with Lowe’s, Home Depot, Sutherland’s, and of course the Garbe website when warranted, then check the prices in person. For the most part Lowe’s and Home Depot sell comparable products for about the same price. In store sales could make a big difference when you could find them though.

I went with Lowe’s for doors (interior and exterior), windows, casement, baseboards, tub, and sheet rock. I purchased all of this with there 12 months no interest plan. I had to buy everything at once and have it delivered but it was definitely the way to go. I paid cash for all other purchases at Lowe’s so I haven’t paid any interest at all. Some of those monthly bills got pretty steep though.

I also re-discovered the local lumber yard. They have a much larger stock of lumber and plywood than the home centers. To my surprise I also found that their prices were actually equal and sometimes even lower. I purchased all of the siding, and cedar lumber to do the exterior at Millcreek Lumber.

One of the nicest surprises I found was at the local Habitat for Humanity Restore.
This is a store operated by the local Habitat for Humanity. They take donations of just about any construction materials you can think of and re-sell to the public. I bought all or most of the door knobs, light fixtures, faucets, tile accents, and vanity counter top there. The savings were overall pretty good. I replaced all of the interior knobs in the house with new satin nickel knobs for $3.00 a piece. I got several light fixtures for $5.00 a piece on their monthly special. These were lights that had been in their stock for a long time. All of the light fixtures were solid brass and very good quality, although a bit outdated. The vanity counter top was another steal at $20.00. The plumbing looked like a good deal on the surface but after rebuilding them they turned out to be not quite as good of a deal. The Moen kitchen and bath faucet I bought for $5.00 each actually cost me about $60.00 and $40.00 after replacing the cartridges, wand, and other missing components. A little high for a used faucet. They work well and look OK but I will probably go new next time. I also donated some of the materials worth recycling back to them. Any way you look at it, it is a win win situation.

Here are a few of the items I found at the Restore. Will keep going back looking for more bargains.

Now back to our regularly scheduled blog. Next up is renovating the bathroom.

All right, John Mellencamp thinks pink houses are “for you and me”, but really would you want to live in one. I didn’t. Pink siding and trim with orange brick may have worked in the 70’s but it was time for a change. Driving by you really couldn’t see the full scope of the deterioration of the place but you couldn’t help notice the pink pealing paint. Several of my neighbors stopped by to tell me how glad they were to see the place painted, and a different color.

The next few weeks were quite busy. I had to be able to work during daylight hours. Fortunately, I am self-employed was able to juggle my hours. I began to get up between 5:00 and 6:00 A.M each morning, walked across the hall to my home office and worked at my “day job.” I would stop between 12:00 and 1:00 to go over to the new house. Once it got dark I would go back to the office and finish my day. I only had about 3-4 hours of good sunlight each day on the best of days. January turned out to be a fairly mild month for Oklahoma so it wasn’t too bad. While the sun was shining I didn’t really care how cold it was. I kept so busy I didn’t really notice. On the overcast windy days, it was a different story though.

My original budget didn’t allow for much in the way of materials. At first glance it looked like all that was needed was a couple sheets of siding and a coat of paint. Not even close! It appears that when they did the roof in 2004, they replaced quite a bit of the fascia. The only problem was that they used untreated/unpainted pine boards. The untreated pine weathered to make it look like cedar, which through me off. After removing a couple of pieces I found a lot of rot. It turned out that I would end up replacing virtually all the fascia, about 50% of the soffet and about about a dozen sheets of 4×8 siding. I scrimped a bit by recycling some of the siding. I was able to cut out the rot on some of the large pieces and use it to patch the eaves and fill in the gap on top of the new garage doors. I could have replaced another 20 or so sheets but decide that could come later of necessary.

One nice surprise was a piece of plywood I removed from the roof of the porch. The previous owner had tacked it up to make a repair, but I wasn’t happy with it. To my surprise it turned out to be a 4×5 piece of cabinet grade oak veneer 1/2 inch unfinished plywood. Since it was protected under the porch, the weather didn’t hurt it much at all. I would eventually use this to replace the vanity cabinet in the bath.

I spent all January redoing the exterior. One of the biggest struggles I had was finding warm enough weather to paint. Exterior latex should not be applied in temperature under 50 degrees. Technically, the applied paint shouldn’t be subjected to temperature under 50 degrees for at least 24 hours, but I cheated there. I was able to paint one side immediately after replacing the siding fascia and soffet, but had to wait another 10 days to paint the next section. Anyway by the end of January I had the outside looking pretty good. All of the rotten wood was replaced, painted, guttered, and all new doors and windows were in. The inside was still a disaster but at least It looked good to the public.

After

Most of the heavy demolition and cleaning had been done by the time the foundation was repaired. I had three to four weeks to kill before I could begin full scale renovation so I decided to begin to organize the garage. I built a long work bench from the plywood and 2×4 used to board up the doors and windows. After taking another load of junk to the dump it was time to assess the situation in the garage.

It was obvious that some repairs were required on the garage door. All of the windows were gone and several of the wood panels needed replacing. I had hoped to get a sheet of plywood and repair the existing doors but it would not work out that way. The doors were 9 feet wide x 8 feet high. I may have been able to find sheets of 4 x 9 x 1/4 inch plywood, but I began to think that it would be much more work than I wanted to do. New doors were the way to go this time. Lowes and Home Depot had 9 x 7 garage doors in stock but the 9 x 8 would have to be be special ordered. I had time to wait for delivery but there was a catch. The special order doors were almost twice as much as the stocked models. It appears that the in stock sizes are bought with quantity discounts that the price is kept very low. I decided to go with the smaller door and re-frame the door opening. The only extra materials required would be four nine foot 2×4’s to frame in the 1 foot gap on the top. I planned on using a section of the existing door as siding but that plan would change later. This way would save almost $400.00 so it was a no-brainer.

I decided to go ahead and install the garage doors. The tracks could always be adjusted if any settling did occur. Besides that it would let the neighbors know that the neighborhood eyesore was going away. I had replaced several garage doors before, but it had been so long it didn’t help much. Even though the instructions that came with the doors are geared towards the novice and do-it-yourselfer, it still took me the entire weekend to install the doors. The main stumbling block involved installing the brackets on the center steel post. It was much more difficult positioning and aligning the brackets on a curved surface, not to mention drilling through steel rather than wood. I also discovered another minor problem. Both sides of the garage were about 3/4 inch lower than the center post. The sides rested on foundation while the center post was mounted directly on top of the floating slab. The difference only showed up when the gap on top was framed in. A 3/4 inch drop over 9 feet is pretty noticeable. It wasn’t a big deal though I simply shimmed the 2×4 frame to compensate. Once covered with siding it looked fine.

There were a couple of old 1970’s Genie screw type garage door openers in the garage. I could only find a single transmitter and receiver, but I decided if I could get one working opener out of the 2 it would be all I needed. I spent several hours over the next few days installing, cleaning, adjusting, removing and repeating. I finally got an opener to work for the most part but
the operation was a little erratic. The bottom line was that these openers were just too old. The receiver comminication with the transmitter was fine, but the operation seemed to have a mind of it own. It was time to update to a newer model.

The new door helped a little on look of the exterior. The largest part of the eyesore was gone, but the new door also accentuated the deterioration in the rest of the exterior. Even though it was January, I decided to concentrate on the exterior. Partly to make the neighbors happy, but I was really anxious to see how it would look once renovated. At least the garage was secure, and I would have a place to work and store tools and materials.

This property would be my first experience with slab foundations. I had jacked up a house setting with a crawl space to replace rotting sills, aprons, and joists, but this was a whole new ballgame. My search for foundation repair experts began on the internet. I Googled various search terms to get a general understanding of what was involved. I learned that a great deal of the settling problem were due to trees close to the foundation. The way I understand it, tree roots travel under the house looking for water. By removing the water in the soil under the house the soil shrinks and the foundation settles. No matter how it happened the foundation had some serious settling problems.

Here are a few pictures that give some idea of the settling problem. I could show damage just about anywhere around the perimeter of the house though.

I sent out 4 emails to local foundation repair companies, explaining the damage, and asked for estimates. I recognized several names from the TV commercials. You know the ones with the Coaches and Baseball Hero. I figure these companies must have been busy recruiting and scouting foundation repair rookies because they never answered my emails. I did get an reply form a company that happened to be less than a half mile from the place. We made an appointment to meet the next day at 1:00.

A truck pulled up just a little before 1:00 the next day. A man with a clip-board got out scanned the front of the house and said walking towards me “Son, you need a Bunch of Piers.” I replied “it a-piers that way to me too.” He must not get my sense of humor (or lack thereof) since he just began to take notes without even a smile. He spent the next 20-30 minutes or so taking measurements and making notes. He must have got my little joke just as he totaled up the estimate because a broad smile came to his face. We sat down and he began to explain my options. To sum them up, I could go with 20 concrete and steel piers every 8 feet around the perimeter for about $7,000, or I could go with the same number of all steel piers for around $12,000. However due to the fact that it was December, their slowest time of the year, they would give me a 10% discount if I had the work done in immediately. I decided to go with them on the spot. They would start a couple of days before Christmas and finish just before New Years. That was the plan at least. It turns out that we would experience the mother of all ice storms a couple of days later. They had so many cancellations I was bumped up a couple of weeks. I was one of the few place in town with electricity. I had no gas, heat or water but I had electricity.

Just 3 days into the ice storm a large truck pulled up into my my driveway. More trucks began to show up right after. The foreman came over, introduced himself. He gave me a quick explanation of what was going to be done that day and asked for my check for half of the repair cost. Within minutes a six man crew was moving equipment, cutting large holes in the sidewalks and back porch, digging holes and in general working a lot harder that I would want to. Once they were well established, I decided to leave them alone and get back to work. I told the foreman I would be back around 3:00.

To my surprise, at 3:00 when I got back the crew was gone. All of the concrete had been cut, holes dug and the piers filled with cement.

They came back about a week later to finish the repair. A little larger crew showed up this time. Within minutes of arriving, the crew was placing large bottle jacks on each pier, dropping off concrete blocks and steel plates around each hole. Once again I told the foreman I had to get back to work and left around nine. By noon when I came back on my lunch break, the house had been raised, several holes already filled and the place was buzzing with activity. Cracks were being mortared, joints caulked, dirt compacted, concrete patches poured in the sidewalk and porch. I was impressed! The foreman told me that they would haul off all of the extra dirt, but I asked him to move to the back yard. I would eventually use it to regrade the soil surrounding the foundation. He would haul off the broken concrete and other debris though.

As the crew continued to work, the foreman took me around the house pointing out all of the improvements. The floating corner was now meeting the slab. The separating sheet rock had moved closer but not quite back to the original spot. He explained that it was not always possible to raise the foundation all the way. There were many factor involved in how much they could safely raise the foundation. The cracks in the brick were being re-pointed and missing brick replaced. Overall I was very pleased with what I saw. I told him that I was ready to get started replacing doors and windows. He warned me to wait a minimum of 4 weeks, to allow any settling that may occur. I gave him the final payment for the work and and went back to work. Several hours later when I returned the crew was gone.

Neighbors continued to come by while the work was being done. I learned that piers around the neighborhood were a source of great pride. The number and style of piers, the guaranty, the company name, and total cost were all factors in what made their foundation repair special. I lost on all count other than number of piers, but I’d use this company again.

I also began to get other visitors that had seen my property listed on the internet under foreclosures. It appears that the place was listed as sold for the judgment ($24,000). That was not the case at all. With the auction price, back taxes, legal, and now foundation repair, I was at $42,000. This was actually what the original auction had brought in, the one where both bidders backed out. Still a good price but no where close to what was listed on the net. Anyway I was on my way finally. I would have 3-4 weeks to plan, clean, buying materials, and make minor repairs, but I was now on my way. It felt good.

I finally had deed and full access to the property. The inside was nothing like I expected. The place had been boarded up so I could not see much of the interior prior. There were surprises around every corner. Some good, some not so. Neighbors began to stop by and see what was happening with the place. I let them know what I was planning and got a lot of information in return. Each neighbor had a different take on what happened with the property so I will probably never know the full details. One thing I can say for sure is that the place had been completely abandoned for close to 2 years. Neighbors had actually attempted to have the place condemned. The exterior had been neglected and was deteriorating badly. Kids had broken in and had been using the place as a club house. One neighbor even suspected the homeless had been living there. I’m guessing the lien holder finally took charge and winterized and boarded the place up. There were stickers on each plumbing appliance and most of the windows and doors were covered with plywood.

The interior was a mess. It appeared the previous owner had simply walked away from the place, leaving clothing, furniture, and personal papers, and much more. I spent a full day taking documenting conditions of the place, then the next few days cleaning the place up. Kids had knocked holes in most of the walls, or sprayed them with graffiti. Clothes, 45 RPM records, and papers were strewn all around the place. The garage was packed with so much junk, it would take 4 trailer loads to the land fill to clean up. I would have to clean up the place before I could start cleaning up the place. That was how bad it was. I also decided to clean up around the yard so the neighbors would know that the place would be fixed up.

Once the place was cleaned up a bit I began to realize exactly what I had bought. I’ll start with the bad news. I could tell from the exterior that there was some major foundation problems. Once inside though, it became more clear just how bad they were. There were cracks in almost all of the walls (besides the ones created by the kids). One interior wall, perpendicular to the back exterior wall, had a 3/4 inch gap halfway up the wall. The force had actually pulled (or sheared) a piece of the baseboard apart. The front right corner of the house was floating about 1/2 inch on top of the floor. It was evident that I would have to have the foundation repaired before I could do much else.

The kitchen and bath weren’t in very good shape. The bath vanity was made out of particle board that had gotten wet and was badly deteriorated. The green fiberglass one piece tub and surround had a large crack in the bottom of the tub.
The kitchen cabinets, counter top and appliances were still usable but outdated. The floors were carpeted over 12 inch vinyl tiles, but the carpet was in bad shape (except for one room). The garage overhead doors, front door, sliding glass door, all needed replacing. All of the woodwork (doors, trim, and baseboards) was vinyl coated particle board. The place would basically need to be gutted. There wre also a few surprises with the plumbing and electrical but I’ll go into that later.

Now for the good news. The roof had been replaced in 2004. I discovered some photos in a box in the garage that showed the condition of the place before the roof was repaired. There were some serious leaks in the front of the house and garage. The sheet rock on the ceiling had also been replaced where the roof leaked. I’m guessing about the same time the previous owner replaced the 4 bedroom windows in the front of the house. They weren’t exact matches to the original, and they would have to be re-hung when the foundation was repaired, but they would do. The heat and air had been updated about the same time, so that was an avoided (expected) expense. The dishwasher was fairly new. I would have to replace one valve but again another avoided expense. Finally, there were several huge rolls of carpeting in the garage. I could tell that it wasn’t new, but it appeared to be in near perfect condition.

I finally had a good idea of exactly what I had bought. Overall, I felt good about the situation. I immediately began to look for foundation repair estimates. In the meantime I decided to begin the demolition. I would remove all of the vinyl woodwork and doors, take the floors down to the cement slab, gut the bath completely and remove the built in kitchen electric oven and gas cook top. I was on my way finally!

I received a refund for my 10% deposit from the county clerk within 2 weeks. I fully intended to bid again on the same house when it came back to auction, but in the mean time I kept looking for other “deals.” I found several possibilities, but one looked especially intriguing. The opening bid was set at $0.00. I discovered that the property was being sold “without appraisal.” In many mortgage contracts there is a clause that allows the lien holder to do this in foreclosure. I can’t say why they might invoke this clause but in this case I have some idea. It could be due to the fact that the judgment was well below the appraised value, or that the place had serious structural problems (settling slab foundation), or due to the fact that the house did not sell in the first auction several months earlier. It may have been all of these factors working together.

My initial research determined that the property had an assessed value of $71,000, an appraised value of $60,000 (matching recent comparable sales), and a judgment of $25,000. I also discovered that there was $3,000.00 in current and back taxes. The property went though an auction about 2 months earlier in which the high bid was $40,000.00. The highest bidder and the second highest bidder both back out of the sale (neither placed the 10% deposit.) so it was back again in auction. I expected to bid up to $42,000. Depending on whether the HVAC required updating, I figure materials to renovate the place would be in the 7-12,000 range. This was actually a wild guess because I had no idea of what the interior would look like and a complete miscalculation of the cost to repair the foundation.

To my surprise I was the only person bidding on this property besides the bank. The banks attorney opened at $30,500, I countered with $32,00, and it was over. Here is where the fun begins. I went immediately to the bank for the $3,200 cashiers check and take it back to the Sheriffs office. The deputy looks at the check and tells me it is mode out wrong. It is made out to the Tulsa Count Clerk rather than the Tulsa County Court Clerk. I go back and get a new check. Later that afternoon I call the attorney’s office to see about getting the abstract updated. The assistant congratulates me and tells me that the rest of the process should go smoothly. Now where did I hear that before?

A couple days after the auction I get a call from a gentleman interested in the property. He tells me that he missed the auction and would I be willing to transfer the property to him for a “small” profit. He emphasized the word small. I told him I may be, but until I get the abstract back and title opinion I couldn’t make a decision. I had no intention of letting him have it but I also knew he could be trouble. If he really wanted the property, all he would have to do is contact the owner and agree to settle the default and give him a small fee for letting him do this. The owner would get little or nothing the way the auction went, so even a few hundred dollars may be all it would take to get the owner to agree. Until the final court confirmation the owner had the legal right to cure the default and retain the property. He would have another 3 1/2 weeks to do this.

It took the title search company 10 days to update the abstract. There was a great deal more work on this one than there was on the first one that I sent them. I take a quick glance at the abstract on the way to my attorney’s office. I notice a red page concerning unpaid taxes. Someone had bought a tax certificate on the property for the past 2 years. I comment on this when I hand it over. He tells me he will read it over and have his opinion by the first of the week. The following Monday I get a call and he tells me what he found. Another error in the legal description on one of the papers filed with the court. This error appeared on a single paper but it could potentially void the entire proceedings. He has a call into the bank’s attorney but hasn’t heard back. It would take another few days to determine if I should continue with the purchase. Finally on Thursday, less than 2 weeks from the confirmation hearing, I get a call that new papers had been filed with the court and that the sale could still go through.

It was finally the time for me to draw on my line of credit. I went to the bank and deposited $20,000 from the line of credit to my personal account. Except for the possibility that someone was trying to cure the default and problems with the foreclosure papers still existed, I felt somewhat relieved to get this out of the way. That relief didn’t last too long. The following Monday I checked my account balances online. Only $5,000 of the $20,000 had been credited to my account. I check with the bank and discover that there is a 10 business day hold on large checks. I would have to get documentation from the lending bank that the funds were available and my bank would release the hold. I go home and call the bank, which is in Rhode Island, and ask them to fax a statement on their letterhead to my banks Risk Management office. They inform me that their policy is to not release any personal information and that they cannot send the Fax but if my bank will call them they can confirm the funds are available. I contact my bank and they inform me that their policy is to get written confirmation. I’ll cut it short her and tell you that this went back and forth for 2 days. As ridiculous as the situation seemed to me I was going to have to wait the 10 business days for the funds to clear. It was now Tuesday, Thanksgiving was on Thursday, and the confirmation hearing was set for the following Tuesday. I had to have a cashiers check into the Court Clerks office by Monday at 4:00. I call my dad to see if he could help me out. He checks with his broker and his brokerage firm will loan him the money and will have a check overnighted. He receives the check late on Wednesday but too late to deposit in his bank. The Friday after Thanksgiving he takes it to his bank and guess what. They have the same hold period.
So now I have 3 days to somehow get the funds. But wait there is something else.

Ever since I get the call from the guy wanting to buy the property from me I check the court records each day to see if any new paper are filed. Sure enough at 7:30 Friday Morning, paper are filed that the confirmation hearing is “stricken.” I call the foreclosure attorney to see what this was about and they know nothing about it but will find out and call em back. Later that afternoon they call too let me know that the Judge was out of town and they could not finds out why the hearing had been canceled. The judge’s clerk agreed to place the hearing back on the docket until the judge could be contacted the next Monday. So here I was no funds (or at least no cashier check), not sure if the sale would be confirmed, not sure that the papers have been filed correctly, and still fearing that an outside source was trying to stop the sale. That weekend of waiting was no fun.

In the meantime, dad had contacted a long time friend who is a bank manager in s small time outside of Tulsa. He will vouch for him and cash the check and issue a cashier check immediately. I tell him about the possibility the confirmation hearing will not go through on Tuesday and that he should wait. We decide to wait until Monday morning before we go any further.

I finally get an answer about 10:30 Monday morning. The hearing is on but I don’t ask why it was temporarily stricken. My dad is in meetings all morning so I leave a message that I’ll need the cashier check. He finally gets free around two, but has to drive 70 miles round trip. We keep in touch by cell on his progress. I get a call about 3:30 that he is back on the road. We decide it would be best for me to meet him downtown. If everything goes perfect we will be cutting it close. There a great deal of street construction downtown and it seems like it takes me forever to find parking. I call dad back and tell him about the roadblocks and a way to avoid them. We decide that I will meet him outside the County Court House. About 5 minutes before 4:00 he arrives, pulls over to the curb, rolls down the window, hands me the check and I immediately start running. I make it just under the wire. The clerk takes my checks and prepares the receipts. The worst was over I think, or is it?

I suit up the next morning and head off to the courthouse about 8:00. The confirmation hearing is set for 10:00. I find the courtroom listed on the court papers, but notice that the judge’s nameplate on the door doesn’t match. I’m a little early and no one is around so I decide to check if I have the right place. It turned out that the courtroom listed in the court papers. I finally find the correct courtroom but it is empty. It’s only 9:30 so I decide to sit and wait. Over the next 30 minutes the halls and surrounding courtrooms filled with people. Around 10:00 the hall began to empty as people moved into the courtrooms. The courtroom the confirmation hearing was to be heard remained empty. By 10:15 the hall was empty except for another couple and me. I heard them talking earlier about real estate and confirmation hearings. Were they the owners ready to contest the auction, were they attorneys, were they associated with the guy who wanted me to turn over the property for the small profit.

The courtroom is still empty at 10:30. Every one in a while the hall fills with people as a court goes into recess. My attorney happens to walk by, asks how everything is going, but can’t stop and chat. The halls soon clear again except for the couple that had been waiting with me. We sit and wait another 20 minutes when an attorney I had seen several times at the auctions walked out of the judge’s office next to the courtroom. The couple walks over and I hear them ask something about confirmation hearings. I can’t hear so I walk over to them to ask my own questions. As I near I hear the attorney explain that there is no actual court hearing in confirmation hearings. The attorneys simply notify the judges that all requirements have been met, the money has been deposited and the judge signs the confirmation. She explains that the so-called confirmation hearing probably was concluded in her office about 10:01, and that we can check with the judges assistant next door to the still empty courtroom. I follow the couple in and hear them ask about another property. The assistant tells them it has been confirmed and they leave. I ask about mine and she tells me that it has been confirmed also. I think to myself that the ordeal is finally over, but then I think to myself “or is it!”

I run into the couple again waiting for the elevator. They tell me that this is the first property they bought at auction. They ask me if I know when the Sheriffs deed is issued. I don’t know so we decide to go downstairs together to the sheriff’s office and find out. The deputy at the desk tells us that the deeds are signed once a week. If the judge sends the paper work by the end of the day the Sheriff will sign the deeds the next morning. If there is a delay then it will be the next Wednesday before it can be issued.

The next morning go back to the country courthouse. I first go to the county assessor’s office to check on the back taxes. I get the amount required to get them up-to-date, but am told that unless I have clear title to the property I shouldn’t pay the back taxes. I go back downstairs to the Sheriff’s office and wait in line to see if the deed has been issued. The deputy shuffles through a pile of papers, and pulls out a couple of pages. I sign one of the copies and ask what next. I’m told that I need to record the deed with county records. I spend the rest of the morning running to county offices to pay the various taxes and fees, but by noon I had finally ought my first investment property. But what exactly had I bought. I’ve done a walk around and looked in windows but I really knew very little about the shape of the property inside.

This is what I end up with. Guess what’s inside.

While I was well into my research, I began looking for ways to finance my first investment. I only had about $10,000 in liquid cash so more financing was required. My primary residence had been paid for several years, so it was the obvious choice to raise additional funds. I used Lending Tree services to set up a line of credit using my home as collateral. My plan was to draw the funds as needed to save on interest. Any principle and profits from the future sale could then be used to pay off the loan or finance the next purchase. The plan changed over the course of the next few months, but overall it was a good plan.

With funding in hand and some vague notion of how the foreclosure process works I was ready to jump in with both feet. I went to my first auction ready to bid on a single house I had researched. I’ll jump ahead here and say that the property was recalled and was removed from that days auction. It took another few weeks before I could find another property but I found a promising one close to where I lived. The 3 bedroom 1 bath house had been abandoned and vandalized unmercifully. That didn’t deter me since I had planned to do a complete renovation anyway. Comparable (un-vandalized) homes in the area went for between 50 - 65,000. The opening bid was a mere 14,000 so there was a lot of room to make some profit. I had already determined that it would take about 7 -10,000 in materials and I would supply all of the labor so it seemed like the perfect candidate.

The property I wanted to bid on was one of the last ones of the day. I sat and watched a couple of spirited bidding wars among public bidders but most where either recalled on kept by the banks and mortgage companies. Once the bidding started, the attorney opened with the expected 14,400 minimum bid. I countered with 15,000..he with 17,000..I with 18,000…he with 19,000…I with 19,400… and that was all of the bidding. I won! I went immediately to the bank for a cashiers check for $1,940.00 and returned to the Sheriffs office. That seemed easy enough.

As I was walking into my home office, the phone rang. It was the attorney representing the bank in the foreclosure. He told me he had the abstract if I wanted to view it and that the sale should go smoothly from here. I had already talked to an attorney about getting a title opinion. He informed me the abstract must be up-to-date before he could render an opinion, so I told the attorney that I would have the title company pick it up the next day.

Fast forward a week and I call the abstract company to check on the progress. They ask for the legal description of the property which I give them as written on the copy of the court papers…”Lot X in subdivision Sun Valley Addition”. For some reason they cannot find the papers and tell me they will call back. They call back an hour later and tell me they have an update ready for “Lot X in subdivision Sun Valley Second Addition”, and that it will be $450.00. I run down and pick it up and take immediately to my attorney office. I point out to the receptionist that the legal description on the court papers do not match the legal description on the abstract. She calls the attorney to the lobby and has me show him what I was talking about. He immediately tells me that I do not want to buy this property and not to bother having him read any further (saving me his $250.00 fee). He tells me that the foreclosure proceedings are not valid and they will have to start over from the beginning. In short I had bid a property that didn’t exist. It depends on how I look at it. I had either paid $450.00 for absolutely nothing or I had paid $450.00 to save myself thousands in future losses. If the sale had gone through, technically I would have been renovating a home that never went through foreclosure. The only consolation I got was the attorney told me he would send me copies of all the new proceedings and let me know when it would be up for auction again.

It’s a true fixer upper. For an initial investment of $20,000, $10,000 maximum in materials, and do-it-yourself labor, a $30,000 net seemed like just the deal I was looking for. I had iuntended to bid on it again when it came back to auction but I found a much better deal while waiting. I’ll tell you all about it next.

The place wasn’t as bad as it looked. As long as I could remove the graffiti from the vinyl siding it was actually quite new and in good shape. The roof had been shingled within the last 5 years. The floors had solid oak under old carpet. There was a lot of sheetrock work and the kitchen and bath would require a complete overhaul but it was a project that should give a good return.

For years I have thought about investing in residential properties. I’ve had some experience in just about all phases of home building, not mention having seen every episode of “This Old House”, so I like to think I’ve earned a “BS” degree in everything housing. You probably notice a lot of that “BS” as I recount my adventures in buying foreclosed properties. My initial research began online looking for general information on foreclosures. From there I concentrated on Oklahoma law and then the individual County procedures. The difference between what you think you understand from research and the way things really are can be quite comical.

In Oklahoma, once a loan is in default, foreclosure papers are filed in the county the property is in. All parties are notified, a judgment, setting the amount of the default, is handed down by the court, an independent appraisal is ordered, fees are assessed, and an Sheriffs auction date is set. The default can be cured anytime up until the confirmation hearing. Each county has their own procedures for listing the properties, but you can get a list from the county Sheriff’s office. Their list usually includes the property address, name of debtor, lien holder and representing attorney, auction date, case number, and appraised value. With that little bit of data, a wealth of information can be researched. With the case number, the public can view the paper filed with the courts and even do a preliminary title search to determine other liens such as tax liens. I’ll go into this in more detail when I go over my first auction win.

Even though the appraisal typically sets the minimum opening bid (2/3 appraised value) I consider it meaningless. As I understand it the appraiser simply drive by the property to make sure it exists and then they do an analysis of recent comparable sales. There is very little physical inspection and an interior inspection is almost never done. The caveat “Buyer Beware” is in full effect here. In some rare cases a property can be sold “without appraisal.” I’ll give a hint an say this was the case in the property I ended up with, but the caveat should be posted in large flashing neon letters with alarms sounding when you see this case come up.

I started going to the Tulsa and Wagner County auctions several months before I was ready to start bidding. The Tulsa auction is quite a bit larger than in Wagner and operates in a slightly more formal manner due to the size, but for the most part they are the same. The lien holder starts the bidding at whatever dollar amount that they decide. Anyone else can make subsequent bids in minimum increments of $100.00 but less than $5,000. The lien holder is not limited to this rule, they can bid in any amount they choose. The lien holder (or their attorney acting in their behalf) will continue to bid until there are no more counter bids or until the bidding exceeds their loss. I was never able to figure out how to predict how the lien holder will bid. They often bid well in excess of the appraised value, and sometimes even open the bidding way over the appraised value. They almost always exceed the judgment and associated cost listed in the court papers also. If anyone has an inside view of how they operate I would love to find out more. I have a good idea they only bid up to their losses but I haven’t been able to determine if the general public can get this information beforehand

If someone from the general public is the high bidder they have 24 hours to put down a 10% deposit in a cashier check made out to the County Court Clerk. If the high bidder fails to put down the 10% the next highest bidder has the opportunity to by at their highest bid. That is if they can be contacted. If neither bidder places the 10% then the property is rescheduled for another auction. Once the deposit is received, a confirmation is set 4 weeks from the auction. In this time the default may still be cured but I understand this almost never happens. There are still a lot of things that can go wrong in the 4 weeks leading up to the confirmation hearing as you will soon see.

Well, that pretty much sums up my research or at least glosses over the high points. Next I’ll recount my adventures in buying properties at auction
.

Toile is an excellent way to add beauty to your home. Toile can give a soft touch to a room using theme colors for bedding, lampshades and curtains. I found a website which offers some good advice about using Toile in decor as well a little history on the fabric. Here is an example of information from the website: “Pronounced twäl, this historic design has been making a comeback in recent years. In the past toile was usually applied to curtains or upholstery, now the focus is bedding. Toile bedding has one color of background, usually white or off-white, and a repeating themed (typically pastoral) pattern that is represented in a single color such as blue or red.”

I posted before about my bedroom redesign, and now I’ve got pictures of my new gameroom.