The Art of Fix 'n Flips - Step 2 - Cash 4 Keys or Eviction

Once you have obtained the perfect property for your investment needs, it is usually important to get it vacant. Depending on how you purchase your property will determine whether or not it will have tenants (or homeowners) currently living in it. A great benefit of buying a home on the market as either a foreclosure or shortsale is that it will typically be vacant upon closing. Since these have quite a bit of competition from other investors, however, let's assume that you are buying at some form of auction.

If you have a property that is occupied, there are several things you will need to determine before deciding which steps to take. Since it takes 2-3 weeks to receive the grant deed from the Trustee, you cannot begin a court eviction process because that is required for filing. The first steps to usually do is determine whether the occupant was a previous owner of the home or a renter/tenant. The laws are quite different for both, and depending on which they are is how it is best to carry the initial conversation. Most people that are foreclosed on do not expect someone to check on them right away, and will usually not yet be in a state of worry (although there are always exceptions). Since most of these people have lived mortgage free for 10-20 months they are often ready to relocate and will cooperate. I always recommend adding a bonus for leaving things clean and relocating in a timely manner. It is one thing for them to have a foreclosure on their record, but a foreclosure AND eviction is something people will want to avoid if they can.

There are certain scenarios, however, where being nice and offering help to the owners/tenants does not work. They may be mad or upset at the system, at the banks, at themselves (since they usually got themselves into it in the first place), and are not in a state of mind of cooperating with anything you may offer. In this case an eviction process is necessary. The services we usually use for this range from about $600 (for an independant eviction service provider) up to $1500 for a great attorney. The process they will go through is typically the same and usually better to save a little money whenever you can. It will take 2-3 weeks to set a court date, and the judge will give 7-10 days for the person to move out (with a sherrif's eviction). Throughout this process it is very important to do everything quickly as in the fix 'n flip world every day matters.

Once the people are out of the property, you will face the next steps of the bidding and remodeling process. Join us for this next topic later this week!