How to Find Distressed Properties in Illinois

Distressed properties can be an investor's dream. Properties in financial trouble often sell for far less than fair market value, making them a steal if they are in good condition. Distressed properties are those with liens, in foreclosure, or otherwise compromised. The trick is finding the sale before anyone else. When looking for distressed properties, you have two choices: government sources and commercial sources. Some places to look include county recorder and assessor's offices, sheriff's departments, the courts, and state agencies. Some private sources include law offices, realtors, newspapers, public auctions, and online platforms.

The majority of distressed properties become that way due to foreclosure or pre-foreclosure. A lien may be placed on the property when the owner cannot pay their mortgage, taxes, or other creditors. From there, the lienholder can foreclose and sell the property at auction. If you can find houses in pre-foreclosure (before they are sold at auction), you have a golden opportunity to make an offer that the owner may jump at. Some places in Illinois to find foreclosure and pre-foreclosure homes include:

Liens often lead to foreclosure. Although most homeowners have a mortgage lien, they do not have tax, judgment, or mechanic's liens. When a property owner struggles financially, they may be unable to pay the mortgage, taxes, or creditors, incurring additional liens on the property, and the only way out of the mess is to sell it for less than fair market value to pay off the debts. Finding lien properties is another fantastic way to find distressed properties, many of which are in perfect condition and only being sold to solve a problem. Some ways to identify lien properties are:

Illinois Department of Revenue

The best place to look for lien properties is the Illinois Department of Revenue, which has a Tax Lien Registry listing all houses with a tax lien. Although the listing is not a list of auction properties, it does show which properties have tax liens filed on them and when. If you hurry, you could contact the owner and make an offer before they put the house on the market or it is auctioned off in foreclosure. You can search the registry by lien ID, owner name, property address, lien status, and lien date. You can even search for commercial properties that have liens.

County Recorder's Offices

Tax liens are also public records filed with each county recorder in Illinois. You can contact the county recorder's office or visit in person to ask about recently filed liens. For example, Cook County has a tax lien search tool right on its website. Some other county recorder's office lien search tools include:

• Adams County Liens
• Grundy County State Lien Registry
• Kane County Recorder Search
• Jackson County Delinquent Tax Properties
• Lake County Open Liens
• Ogle County Liens
• Woodford County Tax Lien Search
• Whiteside County Land Record Search

Illinois Courts

You can also search the Illinois Courts for recently filed judgments and mechanic's liens. The state has a well-developed, easy-to-use website with a search tool for finding cases. They use a system called re:SearchIL for case files and searches. You can also visit any county clerk's office and ask for a tax lien search. You may have to pay a fee for the report.

Illinois Secretary of State

The Office of the Illinois Secretary of State also has a search feature for Federal Tax Liens on property. You can search by federal tax lien number or name.

Use a Title Company or Real Estate Attorney

Title companies and real estate attorneys are also helpful resources. During the purchase of property, they perform a title search, looking for any encumbrances, title issues, and liens. You could hire them to run a search in a specific area looking for recently filed tax liens and then contact the property owner to see if they would be willing to sell. Some title companies and real estate attorneys in Illinois include:

Illinois Title Companies

• Central Illinois Title Co.
• Chicago Title
• Greater Illinois Title Company
• Old Republic Title
• Prairie Land Title Company
• Stewart Title - Chicago

Illinois Real Estate Attorneys

• Illinois Real Estate Lawyers Association
• Law Office of James Kottaras PC
• Marneris Law PC
• The Real Estate Law Firm, LLC.
• REAL Law Group
• Shawn Bolger Limited Real Estate Attorney

Third-Party Online Databases

Another option for searching for distressed properties is to use third-party online databases like PropertyChecker. These databases sometimes allow you to download detailed property records, including lien information.

PropertyChecker is an excellent option for quickly and easily obtaining a complete property report, including value, taxes, liens, foreclosures, and other essential data. You can quickly search using the property address to see if it is in pre-foreclosure or has liens that may lead to foreclosure. You can also search by zip code to view all the pre-foreclosure homes in a specific area.

People in financial trouble sometimes choose bankruptcy as a solution. Bankruptcy is a serious step with some long-term consequences, one of which is selling property to free up cash to pay off debts. Depending on the bankruptcy terms, property owners may be forced to sell property far below market value. Another valuable resource for finding a distressed property is locating bankruptcy filings and lien property sales. Use the resources below to identify these properties and owners so you can make contact and place an offer.

Search Federal Bankruptcy Court Records

PACER (Public Access to Court Electronic Records) is a federal records system where you can search for bankruptcies, liens, and other federal court filings. To use the system:

• Visit pacer.uscourts.gov.
• Register for a PACER account to access federal bankruptcy filings.
• Search for bankruptcies in Illinois with the U.S. Bankruptcy Court.
• Review the results and refine your search if necessary.
• Find and download what you need.
• Contact the property owner and see if they are interested in selling.

* PACER may charge you a fee to download documents.

Local Bankruptcy Court in Illinois

Try contacting the local bankruptcy court in Illinois and asking for public records related to recently filed bankruptcies or liens. The local courts are divided into sections. You can use the court website to perform a search or visit in person and ask for records. If you go in person, you may have to pay a fee for copies.

• Central District of Illinois Bankruptcy Court
• Northern District of Illinois Bankruptcy Court
• Southern District of Illinois Bankruptcy Court

Illinois Department of Revenue

The Illinois Department of Revenue has a tax lien registry showing all distressed property due to tax liens and their status. You can freely review this list without a formal reason. The list shows all recently filed tax liens within the state. You can also subscribe to the list to receive notifications of new entries, but subscriptions cost $500. A renewal costs only $50.

County Websites

Many Illinois county websites display lien sales or foreclosure property sales on their websites. Visit the website and make a note of the sale. Be sure to register early, have the cash on hand, and attend. You can also visit in person to ask about any upcoming tax lien sales or foreclosure auctions. Use the links below to get started.

• Cook County Treasurer
• DeKalb County Tax Lien Sales
• Jackson County Tax Delinquent Properties
• Lake County Foreclosure Sales
• Lake County Tax Sales
• McLean County Real Estate and Mobil Home Sales
• Peoria County Foreclosure Sales

Multi-Court Voice Case Information System (McVCIS)

You can also call the self-help voice line, Voice Case Information System, at 1-866-222-8029 to get basic information on filings.

Lien Sale Notices in Local Newspapers

Along with foreclosure auctions, tax lien sales are also published in the local newspaper. Regularly review the classified section, ads, and realty area of the daily newspaper to look for any mentions of lien sales or lien notices. Use the list of newspapers above to begin. You can also check online newspapers and sources.

How to Monitor Public Notices for Auctions and Sales

• Bookmark your favorite newspaper, auction, or county websites.
• Check them every day for notice of any upcoming tax lien auctions.
• Review the rules of the auction.
• Prepare your finances and have the cash ready.
• Register early.
• Attend the auction.
• Bid and hopefully win.

Attend Public Auctions and Sheriff's Sales

Finding distressed property can be a numbers game. Attend as many public real estate auctions as possible and come ready with cash in hand, prepared to bid and win. Check the sheriff's department websites above regularly, looking for new notices of foreclosure auctions or tax lien sales. Check the auction resources below to see if any local auction houses are holding one.

Find Information on Upcoming Property Auctions:

• Check out sheriff's office websites, county websites, or local newspapers looking for tax lien sales and auctions.
• Mark your calendar.
• Register online or using the instructions provided.
• Bring cash and attend the tax sale.
• Bid & win.

Use Social Media or Online Platforms

One of the best ways to get the word out is social media. Government offices, realtors, attorneys, private companies, and even sheriff's offices use social media to announce things like upcoming tax lien sales or auctions. Make a list of some of your favorite accounts in Illinois and follow them so you begin to receive notifications of any new posts. You can also message them for more information if needed. For example, someone set up an Illinois Off-Market Properties For Sale group on Facebook. Realtors tend to use social media frequently. Follow those listed higher on this page for some tips on off-market properties.

Consult Real Estate Agents and Brokers

Real estate agents and brokers work with financially challenged homeowners to help sell their property before it's taken in foreclosure. You can find a list of these professionals above and contact them to see if they have any insight on where to find quality distressed properties before anyone else does.

Specialty Websites - Distressed Properties

Specialty websites like the Illinois Housing Development Authority can be helpful when looking for distressed properties. They show a list of available properties on their website. Do a Google search for others like these who may have access to listings you can't find anywhere else.

Hire a Real Estate Attorney

Some attorneys work with people going through foreclosure or bankruptcy. They work on the property owner's behalf, helping them achieve their goals of getting out of debt while losing as little as possible. Real estate attorneys can help connect you, "the buyer," with property owners who may be facing a challenging situation and would rather agree to a quick private sale than put their home on the market. Hire a real estate attorney or cultivate relationships with some in your area to get the scoop ahead of the competition. Use the list of real estate attorneys above to get started.

Homeowners who cannot pay their mortgage often contact their lenders to see if there is a solution. The lender may suggest a short sale if the loan cannot be modified to suit both parties. The bank or mortgage company will help the homeowner advertise and prepare the house for sale, pay closing fees, and help with other aspects of the sale. These houses usually sell for the total of the loan due plus fees and interest, which is often far below market value. Finding short sales could be just the ticket to finding distressed property in excellent condition. Use the methods described below to find short sales in Illinois.

Check Out Bank and Lender REO Listings

When a bank forecloses on a property owner, they try to sell the property at auction. The lender is allowed to bid as high as the total due on the loan, plus interest and late fees. If they are the highest bidder, the property becomes real estate-owned (REO), also known as bank-owned. Banks don't necessarily want to own property, so they will try to sell it privately, through a realtor, or hold another auction as quickly as possible. You can use the list of banks below to contact REO departments and see if they have any recently acquired properties they want to sell. Ask to speak to their real estate or REO associates.

• Bank of America - Foreclosure Properties
• PNC Bank
• Chase Bank
• Capital One
• Fifth Third Bank
• Wintrust Bank
• Ally Bank
• Illinois Bank & Trust Co

You should also contact a few mortgage companies in Illinois to ask about any bank-owned property. Some to check out include:

• Compass Mortgage Inc.
• Crown Mortgage Company
• Diamond Residential Mortgage
• EZ Mortgage
• First State Mortgage
• Stonehaven Mortgage

Find Real Estate Owned (REO) Properties

• Contact one of the banks near you and ask for the real estate or REO department.
• Inquire if there are any available properties for sale.
• If so, make an offer.
• Close the deal.
• Alternatively, you can go online and search realty platforms, auction houses, and HUDHomesUSA.com for bank-owned properties and inquire there.

When someone dies, their estate must go through probate. It is a court-based process where a judge reviews the will (if there is one) and determines how to distribute the deceased's assets. If they have a will, the court may appoint an executor to ensure the assets get to the proper heirs. Often, the estate includes property that must be sold to pay off debts. The courts, family, or a realty agency may be the ones selling the property. You can find good-condition distressed property by researching probate cases and other sources. Use the options below to find distressed probate properties.

Illinois Judicial District Court

Probate is handled at the county level in Illinois. You can visit the county probate courts below to find cases that have property. You can then use the process below to contact the court, make an offer on the property, and buy it. Use the web resources below or visit the courts in person.

• Cook County Probate Court
• Lake County Probate Division
• Madison County Probate
• McHenry County Probate Court
• Vermilion County Probate Division
• Will County Circuit Clerk
• Winnebago County Probate Court

Illinois Regional Archives Depository (IRAD) System

The state has an Illinois Regional Archives Depository System you can use to find probate cases and case files. Read more about it on the Secretary of State's Website, using the link above.

Local Obituaries

Besides the courts, local obituaries can clue you into possible distressed property opportunities. Check the list of local newspapers above or use the obituary websites below to find families with deceased loved ones who may be in the market to sell a property.

• Chicago Tribune Obituaries
• Commercial News Obituaries
• Galesburg Register Mail
• Illinois Times
• Legacy
• McDonough County Voice
• Peoria Journal Star Obits
• Pontiac Daily Leader
• The State Journal-Register Obituaries

Local Funeral Homes

Local funeral homes work with families, and they usually have inside information about the situation and whether or not the family intends to sell off the property now that their loved one is gone. You can contact funeral homes to find out if they know anyone selling off-market property. Some local funeral homes in Illinois include:

• Dieterle Memorial Home and Cremation Service
• Edwards Funeral Home
• Knapp-Johnson Funeral Home and Cremation Service
• Northern Illinois Funeral Services
• Tanzyus Logan Funeral Services and Care
• Thompson Spring Grove Funeral Home
• Worthington Funeral Home

You can also check these websites for obituaries and then go from there.

Local Private Estate Auctions

Some families choose to hold private estate auctions and sell off the property and belongings themselves. Check the local newspaper for upcoming private estate sales or online. You can find companies like Rivich Auction & Estates that handle things like this for grieving families. Some others to try include:

• Blue Moon Estate Sales
• Eric's Estate Sales LLC
• Legacy Auctions & Estate Sales

Local Realtors & Lawyers

Use the lists of realtors and real estate attorneys above to find probate properties. These professionals work with all types of clients, including families that have lost members and need to sell property.

How to Buy Probate Properties

• Locate a probate property and contact the seller or executor of the estate.
• Make an offer for the property.
• If the seller/executor accepts the offer, you must petition the court for approval.
• Appear in court for the hearing.
• Work with the court-appointed real estate agent on purchase details, inspections, appraisals, etc.
• You can close and take possession once the court approves the sale.

Most distressed property is sold in real estate auctions. Those with liens and in foreclosure are typically sold through the sheriff's office or a local auction house. You can try the resources below to find real estate auction sales in Illinois. Be sure to register early and have cash on hand. Most auctions require that you pay after you win the auction.

Private Auction Houses

Public auction houses are a great resource. Use the websites below to check for upcoming auction schedules, or contact the company to ask more questions about potential off-market properties that may be coming up soon.

• Burke Auction & Realty
• Joe Ollis Real Estate Auction Services
• Kim Duncan Auction & Realty
• Kues Bros Realty & Auction
• Property Peddler Inc. Real Estate Auctions
• Rick Leven & Associates, Inc. Fine Home Auctioneers
• Tarrant & Harman Real Estate and Auction Co.

State or City Resources

State and city websites advertise upcoming real estate auctions on the homepage. Some of them have a dedicated page where you can read the rules and regulations and even register to attend. Make a note of the dates and use the state and city links above to regularly monitor these sites for new notices of upcoming property sales.

Online Auction Platforms

Another helpful resource is online auction platforms. These companies gather information from state, city, and county resources and publicize auction listings. You can narrow your search by using the filters and find specific types of distressed properties in certain areas with exactly the amenities you want. Try some of these online auction platforms:

• Auction.com
• Hubzu
• iBid Illinois
• LoopNet
• RealtyBid
• ServiceLink Auction
• Xome

Local Newspaper Auction Ads

Check the local newspaper regularly for auction ads. Check the classifieds, ad area, and realty sections either online or in the paper version to keep abreast of any upcoming realty auctions in your local area. Use the list of newspapers above to get started.

Real Estate Agents

Real estate agents work with many different types of clients. They may have exclusive information about auctions that you might not find anywhere else. Contact your realty associates to ask about any unusual or unpublished distressed property auctions coming up soon.

Property owners, banks, and government offices often sell distressed property to recoup the financial loss. If there is a mortgage or taxes due, selling the property pays off those debts. Other reasons include avoiding foreclosure, avoiding dealing with the necessary maintenance on the property, and needing to sell fast or move to another location.

Although distressed properties can be a great investment, they involve some additional risks, such as:

• Hidden Flaws
• Expensive Repairs
• Legal Issues (title issues, unpaid liens, taxes, etc.)
• Complex Negotiations
• Long Wait Times to Close
• Cumbersome Paperwork

Normal homebuyers won't be interested in dealing with distressed properties, but others may actually look for distressed properties because they can be a great opportunity. Those below will be looking to buy distressed properties.

Real Estate Investors

Real estate investors seek out distressed properties because they realize the immense value. Even if the home needs a little TLC to make it livable, they can still save a lot of money and turn it around for a quick profit. In the U.S., investors purchased 14.8% of all the homes sold. Some investors use distressed property for rentals, bringing in money year-over-year.

First Time Homebuyers

Typical first-time homebuyers have limited funds and a tight budget. They may choose to buy a distressed home to quickly increase their equity or get into a bigger house in a nicer neighborhood. Distressed homes provide ample opportunity for new buyers.

Nonprofits

Nonprofits typically serve the public in some way. Due to the nature of a nonprofit, they usually have limited budgets. When it comes time to find space for operations or to house those they help, they look toward distressed properties to fill the need. They might need a little fix-up, but what they save in the long run makes it worth it. Illinois has over 77,000 nonprofit organizations.

Developers

Real estate developers also seek out distressed property. Sometimes, they look for entire neighborhoods to buy out and revamp or turn into something new, like housing for low-income families or the disabled population. The cheap price makes them affordable and eventually more profitable. Some Illinois real estate developers include:

• Bradford Real Estate Company
• CEDARst Companies
• Festival Properties
• Point B Properties
• Related Midwest

Wholesale Companies

Wholesale realty companies buy properties from people with financial issues. They contact homeowners with tax liens who are in pre-foreclosure and offer cash for their homes. These companies profit from a cheap sale and then fix up the home and sell it quickly. Some Illinois wholesalers include:

• Bigger Pockets
• Cash for Houses
• Happy Investor
• HouseCashin
• Real Estate Bees