On either side of “crier” Dave Leander sat two men on a Douglas County Courthouse bench Wednesday, waiting for him to finish the formalities of an auction.

Within minutes, a bidding war on a home foreclosure was underway.
Gorilla Capital vice president David Evanson made sure it did not last long. With each bid he raised the pot another $500, forcing his competitor — who asked to not be identified — to fold at $42,000.

“It’s for a real old, 100-year-old house,” Evanson said.

Located at 1754 N.E. Klamath Ave., Roseburg, the home showed Evanson enough promise for him to have gone in another $20,000 if needed, far above its opening bid of $37,906.

Evanson needed only a quick assessment to make that call.

“I actually drove by the house for a few minutes,” he said. “Just to make sure it’s still physically there.”

Actually, Evanson makes sure a home foreclosure has a roof, working lights and a city address before deciding it’s worth an investment. “That’s all I need to know.”
Based in Eugene, Gorilla Capital’s headquarters, Evanson makes the rounds in Douglas and Lane counties sizing up property and placing bids. A typical work week can be 50 hours long — and with sporadic success.

“I’ve bought three houses a day, I’ve bought six houses a month — it just depends on what’s coming up,” he said.

According to RealtyTrac, a mortgage-research company, foreclosures increased by 51 percent in Douglas County from 2006 to 2007.

With other parts of the country reeling from the national subprime-loan lending mess, Oregon’s steady housing prices have kept foreclosure rates from soaring. But homeowners last year entering some stage of foreclosure still made up for 10,746 filings, an increase of 12.25 percent from 2006.

Locally, Leander figures foreclosure rates have increased four-fold since the beginning of 2008.

“I see this guy from Gorilla quite often,” Leander said.

But realistically, the retired real-estate agent is seeing fewer investors — an ironic twist — playing the foreclosure game.

“(With) so many of these properties, there’s more owed against them than they’re actually worth,” Leander said.

More often than not, no one shows up for auction.

“I think a lot of it has to do with market values being down, and a lot of these people are sitting on their hands,” said Leander, who auctions homes for Credit Services of Oregon in Roseburg.

Evanson, who sports a beige ball cap with a blue gorilla sewn on the front, said the banks are repossessing more foreclosures after auction lately because their opening bids are too high.

“Sometimes I might go months and months before there’s anything I want in Douglas County,” Evanson said.

For the house on Klamath Avenue, the Gorilla buyer figures he’ll invest $50,000 in improvements before putting it on the market.

Four weeks ago, Matt Klein, crier and manager of a legal services firm in Eugene, postponed the auction of a foreclosure at the county courthouse.

“Usually when something’s postponed, the owner is trying to renegotiate a new loan” by putting money down in earnest, Klein said.

Two bidders who were interested in the property vowed to return for the next scheduled auction.

As a crier, Klein has seen investors snatch up some expensive property. He once sold a home appraised at $200,000 in eastern Oregon for only $84,000.

Both Klein and Leander prefer a cashier’s check for payment. However, that’s not always the case.

“I actually had someone walk up to me with $180,000 cash one time,” Klein said.
Evoking Evanson’s investment criteria, both Klein and Leander say investing in a home sight unseen is dangerous.

And Leander points out other factors to consider, such as missed-payment charges and attorney fees which can all add to the principal.

With foreclosures piling up, Leander expects to auction more homes listed with opening bids set higher than their actual worth.

“I don’t think it’s hit real hard yet,” Leander said. “I think it’s just getting to us.”

• You can reach reporter Adam Pearson at 957-4213 or by e-mail at apearson@newsreview.info.