Where to find below-market properties: every source, ranked

Every source of below-market property, compared

Each source sits somewhere on the same trade-off. The more public a deal is, the more buyers compete for it and the less discount is left. The more private it is, the more work it takes to find and reach the owner. The table scores the ten sources investors actually use.

Why off-market beats on-market for a lowball

A listed home has an agent whose job is to get the highest price and other buyers who make your low number look bad. An off-market owner facing a pre-foreclosure filing or a growing tax bill has neither. Your offer is not compared with five others; it is compared with the alternative, which is often losing the property or the equity in it.

That is why LowBaller's ranking puts recorded deadlines first. A scheduled auction scores 40 points in the model, a pre-foreclosure filing 22, probate 16, a tax lien 12 and vacancy 10, while softer traits like an out-of-state owner add 9.

Fresh pressure beats old pressure

The same signal is worth very different amounts depending on when it was recorded. Most default notices get cured, so a filing from last year is a weak lead while a filing from last month is a strong one. LowBaller's Deal Score, which orders every paid list, scores seller pressure from 0 to 100 and lets timing dominate: the strongest signal counts in full and every other signal adds about a third of its points.

That is why a source's freshness matters as much as its type. A county list you pulled once in the spring is already stale by fall.

The equity test every source has to pass

A seller can only accept a number that pays off their mortgage and closing costs. That is the equity cap, and it decides more lowballs than motivation does. An owner who owes 95 percent of the value cannot take a 30 percent discount however much they want out.

Example: a house worth $250,000 with a $90,000 mortgage and about $15,000 in closing costs can clear an offer as low as $105,000 on paper. The same house with a $210,000 mortgage cannot go below roughly $225,000. Check equity before you spend a stamp; the lowball offer calculator runs the same cap LowBaller uses on every property.

How to pick your first source

• Want deals this month with the least legwork: start with a ranked list for your ZIP and call the top of it.
• Have time and no budget: pull your county's delinquent tax list and foreclosure filings yourself.
• Have cash and like competition: learn your state's tax sale or foreclosure auction rules first, then bid.
• Buying a home to live in: bank-owned listings, stale listings and FSBO sellers fit owner-occupant financing best.
• Live where the inventory is: driving for dollars still finds vacant houses no list flags yet.