04 September 07 - 15:27Why Preforeclosure Investing Can be Your Best Bet

Of the three stages of foreclosure (preforeclosure, auction, or REO), preforeclosure may offer the most investment advantages, overall. Briefly, here are some pros and cons of investing at each stage.

Preforeclosure

Until it is sold at a foreclosure auction, a property in foreclosure is referred to as a preforeclosure property.

If you decide to invest in a preforeclosure property, remember that you’ll be dealing directly with the property owners, who might be difficult to contact. Courthouse research on preforeclosures can also be time-consuming.

But because you’re dealing directly with the owner of the preforeclosure property, it’s possible to create unique sales agreements. It’s also possible to make a low down payment on a preforeclosure property, as well as score a 20% to 35% average savings off the property’s market value.

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