People who have extra money to spare should invest in foreclosed real estate properties for a lot of reasons. And the only reason which seems to matter is that there is a good chance of getting huge profits later on. However, much consideration should be placed on what type of property they are going to invest in.
A person who wants to make money by investing in foreclosed real estate properties should have a keen eye for good properties. These are properties that will probably worth a lot more than its present value a few years later. An investor should also look at the possibility of making use of the property even before it is sold in the market.
The location of a foreclosed real property should always be a primary consideration it can make or break his future as a foreclosed real property investor. A foreclosed real estate property that has a good location will spell a lot of opportunities for the investor.
Most real properties that are foreclosed have to be turned inside out. Some needs minor redressing while other properties have to be repaired before it can command a higher value. This means that aside from investing in the purchase price of the foreclosed real estate property, the investor still has to spend for minor or even major repairs that are necessary to make the property attractive to buyers.
Investors who see the value of foreclosed properties rising in the near future can hold on to the sale but this does not mean they cannot make money out of the property. Some investors proceed with repairs necessary to keep the property presentable for buyers and renters alike. Investors can double their earnings by leasing the property first and selling the property to the right bidder.
Successful investors in foreclosed real estate properties have this special gift of being able to take a hunch as to which properties and locations will become big in the future. Perhaps, it can be attributed to luck or experience on their part.
Investors should have contacts among contractors or bank personnel for real estate properties that are candidates for foreclosure proceedings. If they are confident and patient enough, they can find away to reach the owners of properties that are about to be foreclosed and offer them a good deal so the owners can still get a portion of what they invested.
Investing in foreclosed real estate properties can be a good business but how much a person earns from such business really depends on the ability, the patience and the budget of the investor.
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About the Author:The author is a regular contributor to Foreclosure Advisor where additional real estate information is available.
Thursday, March 15, 2007
Thursday, March 08, 2007
What You Must Know To Make Money With Foreclosures
In the real estate investment industry a few percent can mean tens of thousands of dollars or more. It’s no surprise then that foreclosures are among the most desired methods that real estate investors use to obtain prize real estate at significant discounts to market. From the homeowners perspective, it’s really very sad but from the lenders perspective they would argue that they are simply following the protocol that must be obeyed when a homeowner fails to meet their borrowing obligations.
If you thought that using foreclosures as a means of real estate investment was beyond your ability then you may wish to rethink – particularly as it’s possible to obtain real estate for discounts of as much as 20% or more (to market). With the foreclosure rate due to rise in the near future, this is a strategy every serious property investor must be prepared to implement for increased profits.
This article looks at the foreclosure process, how to purchase real estate with foreclosures and some issues to consider before getting your toes wet.
The Foreclosure Process – How And Why Properties Are Available Through Foreclosure & How To Bid For Them
When a home-owner fails to pay their mortgage (after a number of warnings) their home is sometimes foreclosed by a bank. There are two major timeframes during which you can get involved – either you can choose to offer the existing owner (before the foreclosure is finalised) or you can wait until after the foreclosure and purchase the real estate directly from the bank. The bank may choose to put the property up for sale via an auction or sell it directly on the market.
There are many reasons why home-owners want to avoid having their property foreclosed at all costs – they do not want the foreclosure taboo to show against their credit history. This means that you can step in and purchase the property from the seller before the foreclosure becomes final – if your negotiation skills are good it can mean you picking up real estate at significantly below the market price.
If the real estate is offered for sale at auction then it may be an opportunity to pick up a bargain. However, you’re likely to face competition on any real estate that is considered to be prime. Take into account the following before attending the auction with the intention of securing the property:
(1) Create a plan – what is the maximum amount you’re willing to pay for the property. Decide this before hand and stick with it during the auction. Your plan should also include a blueprint of action should you obtain the real estate. Will you flip it on the market or rent out? Convert into something different? These things must be planned far in advance of you buying the real estate or you could end up with something that doesn’t fit in to your plans.
(2) Investigate the property thoroughly – do you need to spend anything on it by ways of repairs/modernisation? How much will this cost?
(3) Are you funding the purchase with loans? How will you repay the loans? If the real estate does not bring an income do you have sufficient cashflow to service any loans?
(4) Are you confident that the real estate does not have any existing fines related to it? It’s possible to purchase a property at auction only to discover it comes with existing fines which you must now pay ( the real estate instantly becomes a liability - not quite the cash cow you had hoped for).
So why would the government or banks sell these repossessed real estate units at far below their market value? For a start, lenders do not like to have more than a certain number of foreclosures on their books at any given time – they could be accused of periodically lending to those who are unsuitable candidates while the government can make better use of liquid funds rather than assets tied up in real estate.
Either way, the real estate investor wins.
Some “Real World” Issues That You Will Need To Consider Before Getting Into The Foreclosures Market
First, many individuals may well struggle to cope with the idea of being the “nasty person” who profits from someone else’s misery. In the past investors who have purchased real estate through foreclosures have had problems with evicting the existing owners. If this type of situation arises it can be difficult to sort out (and include costly & lengthy legal proceedings to get the tenants evicted). In some places, the previous owner may also have the legal right to buy back the real estate from you.
Despite some potential pitfalls (which can be avoided and planned for) foreclosures remain a good way of investing in bargain real estate.
About the Author:James Franklin
If you thought that using foreclosures as a means of real estate investment was beyond your ability then you may wish to rethink – particularly as it’s possible to obtain real estate for discounts of as much as 20% or more (to market). With the foreclosure rate due to rise in the near future, this is a strategy every serious property investor must be prepared to implement for increased profits.
This article looks at the foreclosure process, how to purchase real estate with foreclosures and some issues to consider before getting your toes wet.
The Foreclosure Process – How And Why Properties Are Available Through Foreclosure & How To Bid For Them
When a home-owner fails to pay their mortgage (after a number of warnings) their home is sometimes foreclosed by a bank. There are two major timeframes during which you can get involved – either you can choose to offer the existing owner (before the foreclosure is finalised) or you can wait until after the foreclosure and purchase the real estate directly from the bank. The bank may choose to put the property up for sale via an auction or sell it directly on the market.
There are many reasons why home-owners want to avoid having their property foreclosed at all costs – they do not want the foreclosure taboo to show against their credit history. This means that you can step in and purchase the property from the seller before the foreclosure becomes final – if your negotiation skills are good it can mean you picking up real estate at significantly below the market price.
If the real estate is offered for sale at auction then it may be an opportunity to pick up a bargain. However, you’re likely to face competition on any real estate that is considered to be prime. Take into account the following before attending the auction with the intention of securing the property:
(1) Create a plan – what is the maximum amount you’re willing to pay for the property. Decide this before hand and stick with it during the auction. Your plan should also include a blueprint of action should you obtain the real estate. Will you flip it on the market or rent out? Convert into something different? These things must be planned far in advance of you buying the real estate or you could end up with something that doesn’t fit in to your plans.
(2) Investigate the property thoroughly – do you need to spend anything on it by ways of repairs/modernisation? How much will this cost?
(3) Are you funding the purchase with loans? How will you repay the loans? If the real estate does not bring an income do you have sufficient cashflow to service any loans?
(4) Are you confident that the real estate does not have any existing fines related to it? It’s possible to purchase a property at auction only to discover it comes with existing fines which you must now pay ( the real estate instantly becomes a liability - not quite the cash cow you had hoped for).
So why would the government or banks sell these repossessed real estate units at far below their market value? For a start, lenders do not like to have more than a certain number of foreclosures on their books at any given time – they could be accused of periodically lending to those who are unsuitable candidates while the government can make better use of liquid funds rather than assets tied up in real estate.
Either way, the real estate investor wins.
Some “Real World” Issues That You Will Need To Consider Before Getting Into The Foreclosures Market
First, many individuals may well struggle to cope with the idea of being the “nasty person” who profits from someone else’s misery. In the past investors who have purchased real estate through foreclosures have had problems with evicting the existing owners. If this type of situation arises it can be difficult to sort out (and include costly & lengthy legal proceedings to get the tenants evicted). In some places, the previous owner may also have the legal right to buy back the real estate from you.
Despite some potential pitfalls (which can be avoided and planned for) foreclosures remain a good way of investing in bargain real estate.
About the Author:James Franklin
Thursday, March 01, 2007
An Industry Of Real Estate Foreclosures - It's Not What You Think
Statistics show that foreclosures are becoming more frequent due to the ever changing conditions of the real estate block. Though most homeowners bought their houses when the rates are still manageable within their income they still have trouble paying off their mortgages. Blame it on the rising prices of commodities while the people's salary remain at their present amount. However, this type of reasoning does not apply to most lenders. Most people with foreclosed properties are left without houses and a tainted credit history. What to do when you feel that your home might be taken away?
Contrary to what you might think, lenders are not really keen to foreclose properties. For one, they are lenders, their forte is to lend money. They are not really equipped to sell foreclosed properties. So it is advisable to contact your lender at the first sign of mortgage payment trouble. Depending on the type of your mortgage and lender, you can work out several options with them rather than foreclosure. The earlier you call their attention to your problem, the more options could be worked out.
The lenders' usual solution against foreclosures is to grant you a suspension of payment. They grant you an option of suspending your dues within a specific time frame so you can assess your financial situation and resume payments. Or as an alternative, they might opt to redesign your payment scheme to suit your current financial fix. To do this, they might lower your monthly dues or change your payment schedule. Either way, you can still continue your obligation without straining your finances. You can also opt for single big payment to update your account and settle your past unpaid dues. This is especially applicable if your housing loan is covered by the government housing agency. This is the most common move of people with accumulated mortgage debts. However, this is only practical for people who expect a large income or for those with a delayed increase in salary. If you expect or better yet, sure of a large sum coming in from one of your sources, this might be the option for you to avoid foreclosures. Remember though, that it is important to continue your payments regularly after that one-time blow-out.
The options I mentioned above are the most practical options if you still want to retain your house and avoid foreclosures. But if it is too late, and foreclosure is the only thing your lender offers you, there are other ways to save face and your credit record. You can choose to put your house on sale and pay your lender with the profit. Since the real estate rates shot up, you can sell your property for an amount that covers your mortgage debt and more. You hit two birds with this one because you can close deal with your lender while having some money to start anew. Another option is to willingly leave the house or move out. This is more of a graceful exit rather than being forced or evicted from your property. You lost your home but it's no reason to lose your pride either.
Please Visit : Foreclosures Information for Foreclosure List, Tax Deed, Tax Lien and General Foreclosure Law
About the Author:For more valuable information on Miami Foreclosures see http://www.miamiforeclosures.com
Contrary to what you might think, lenders are not really keen to foreclose properties. For one, they are lenders, their forte is to lend money. They are not really equipped to sell foreclosed properties. So it is advisable to contact your lender at the first sign of mortgage payment trouble. Depending on the type of your mortgage and lender, you can work out several options with them rather than foreclosure. The earlier you call their attention to your problem, the more options could be worked out.
The lenders' usual solution against foreclosures is to grant you a suspension of payment. They grant you an option of suspending your dues within a specific time frame so you can assess your financial situation and resume payments. Or as an alternative, they might opt to redesign your payment scheme to suit your current financial fix. To do this, they might lower your monthly dues or change your payment schedule. Either way, you can still continue your obligation without straining your finances. You can also opt for single big payment to update your account and settle your past unpaid dues. This is especially applicable if your housing loan is covered by the government housing agency. This is the most common move of people with accumulated mortgage debts. However, this is only practical for people who expect a large income or for those with a delayed increase in salary. If you expect or better yet, sure of a large sum coming in from one of your sources, this might be the option for you to avoid foreclosures. Remember though, that it is important to continue your payments regularly after that one-time blow-out.
The options I mentioned above are the most practical options if you still want to retain your house and avoid foreclosures. But if it is too late, and foreclosure is the only thing your lender offers you, there are other ways to save face and your credit record. You can choose to put your house on sale and pay your lender with the profit. Since the real estate rates shot up, you can sell your property for an amount that covers your mortgage debt and more. You hit two birds with this one because you can close deal with your lender while having some money to start anew. Another option is to willingly leave the house or move out. This is more of a graceful exit rather than being forced or evicted from your property. You lost your home but it's no reason to lose your pride either.
Please Visit : Foreclosures Information for Foreclosure List, Tax Deed, Tax Lien and General Foreclosure Law
About the Author:For more valuable information on Miami Foreclosures see http://www.miamiforeclosures.com
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