PlotHow to Research a Foreclosure Property
The five records that answer whether a posted foreclosure is worth your time: the notice, the appraisal, the deed chain, the mortgages, and the liens.
A foreclosure posting gives you an address and a sale date. Deciding whether it deserves an hour, let alone a bid, takes five records, all public. This is the order PlotCipher works through them, and the order that works by hand.
1. Read the notice
Start with the notice of substitute trustee sale. Write down the deed of trust date and instrument number, the original principal if stated, the current mortgagee, and the legal description. The instrument number is what makes step 4 possible.
2. Pull the appraisal record
The appraisal district record gives you the owner of record, the county appraised value, land and improvement values, year built and building area. In Dallas County that is DCAD; in Collin County the notice app attaches the record to each notice. County value is not market value, but it is the same yardstick for every property, which is what makes the spread useful for screening.
3. Trace the ownership chain
In the clerk's real property index, find the deed that gave the current owner title, then the deed before it. Note whether the current owner took title by sale, by a family transfer, or by inheritance, and how long they have held it. A twenty-year owner and a two-year owner facing the same notice are very different situations.
4. Reconstruct the mortgages
Every deed of trust recorded against the parcel is a loan. For each one, look for later assignments (the loan changed hands) and a release (the loan was paid off). The deed of trust the notice references is the one being foreclosed; if it is not the oldest unreleased loan on the property, the foreclosure may leave a senior lien in place. The mortgage-tracing guide shows the searches.
A release that names the same lender and borrower as an earlier deed of trust closes that loan. A deed of trust with no release is not proof the loan is open, but it is the honest starting assumption.
5. Find the liens
Search the index for everything else recorded against the owner and the parcel: HOA assessment liens, abstracts of judgment, tax liens, mechanic's liens, lis pendens. Note which were released. Then apply the priority rule: liens recorded after the foreclosed deed of trust are wiped by the sale; senior liens and property taxes survive. The lien research guide covers the types.
What the records cannot tell you
Current payoff, taxes owed, condition, occupancy, and any lien that was never recorded. Name those as unknowns and verify them with a title company before you bid.
Doing it in one step
PlotCipher runs the five steps for any Dallas or Collin County address, with every conclusion linked to the instrument it came from, for $1.
Your Foreclosure Agent checks Dallas, Collin, Tarrant, Bexar and Johnson County every morning and emails only the properties that match what you buy.
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