27 July 08 - 00:44Foreclosure Investing: 4 Common Questions
One of the most profitable ways to invest in real estate is foreclosure investing. Here are the answers to four common foreclosure investing questions.
What is preforeclosure?
When a homeowner is in default on his mortgage, the bank begins the foreclosure process to try to recap as much of its money as possible. The end of the process is the foreclosure auction. The preforeclosure period is the period of time from the notice of default to the minute before the foreclosure auction. The preforeclosure period is your foreclosure investing window of opportunity. You can approach the homeowner directly, make an offer, and often buy the property at a price that is well below market value.
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12 June 08 - 11:28Buying Foreclosures: What to Say When the Seller Contacts You
If you’re ready to begin making real estate profits by buying foreclosures, you may have already started to do some advertising, contact the owner of a preforeclosure property, or spread your name through word of mouth. But buying foreclosures requires patience; the owner of a preforeclosure property may not contact you immediately. Many will wait until they feel they can’t do anything on their own before they call you.
But when a preforeclosure property owner does finally call you, make sure you convey that you’re a person,not a large corporate entity. Answer with, “Good morning, this is Mary.” A homeowner stressed by a looming foreclosure will respond more readily to the personal feel of talking with an individual than to the perception of being a number in a large, impersonal company. Even if you’re an expert at buying foreclosures, the owner of a preforeclosure home wants to know how you can help him.
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26 February 08 - 14:59Buying Pre foreclosures: Some Dos and Don’ts
Pre foreclosures are properties whose owners have defaulted on their mortgage payments. Bcause the lender wants to collect the outstanding mortgage balance, they begin the process of foreclosure, scheduling a public foreclosure auction. Up to the point of foreclosure auction, the property is in pre foreclosure.
Though buying a pre foreclosure property can be a great investment deal (because it’s usually sold for a price considerably below market value), some pre foreclosure deals are better than others. Here are some dos and don’ts to keep in mind. If you plan to live in the pre foreclosure, you’ll still want to assess your potential repair costs, but it might be possible to make the repairs over time.
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02 February 08 - 12:02Preforeclosure Investing: There’s Money in Distressed Property
If you’re in the market for sweet real estate investment deals, distressed property (preforeclosure property) investing can be among the sweetest, offering the opportunity to buy property priced well below market value.
The preforeclosure period is a window of investment opportunity for you, the investor, because homeowners are likely to be very motivated to sell their distressed property to avoid the foreclosure auction. This means that you can often buy it at a price well below market value. In addition, buying a distressed property during the preforeclosure period is usually easier (and often require less cash outlay) than competing with numerous others at the foreclosure auction.
Distressed property is not always preforeclosure property; it can be one of several types of real estate, but generally, the term distressed property refers to property that is in preforeclosure, awaiting public foreclosure auction. . (Preforeclosure is the period from the time a homeowner is first considered in default on mortgage payments to the time of the foreclosure auction.) The bank schedules the foreclosure auction for the distressed property in order to collect the homeowner’s outstanding debt.
Keep in mind that a distressed property is often a “fixer upper.” If the homeowner has had financial difficulties to the degree that his property is in preforeclosure, it’s likely that he has not been able to keep up with repairs, either. Remember that when you buy distressed property that is in preforeclosure, you generally buy it “as is.” Remember that when you buy distressed property that is in preforeclosure, you generally buy it “as is.” Make an effort to identify needed repairs and price them before making your preforeclosure investment. Be sure that your cash outlay for repairs won’t cancel out your profit potential.
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16 January 08 - 11:37Making Money with Real Estate: Pre Foreclosure Investing
Interested in making money with real estate? Consider pre foreclosure investing ― a great way to begin making money with real estate, without the usual financial scrutiny. But before you start in the world of pre foreclosure investing, you should understand a little about the inner and outer process the owner of a pre foreclosure property may be going through.
You have about three weeks (the usual pre foreclosure period before the foreclosure auction) to contact the owner of a pre foreclosure property, as well as complete the paperwork and title search, obtain funding, etc. Navigate the pre foreclosure period well, though, and you’ll be on your way to making money with real estate.
It’s important to consider that most owners of pre foreclosure property are highly stressed and may be mad at the world for the situation they’re in. At first, they may not be friendly or open to your offer to buy their pre foreclosure property. Though your goal is making money with real estate, their goal, though they may not know how to achieve it, is making it all go away.
So, your more immediate goal is not making money with real estate, but making them realize that you can help them make it all go away, by buying their pre foreclosure property. Help them realize you can rid them of the mortgage debt they’ve fallen behind on, and help their credit remain as unharmed as possible.
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24 December 07 - 17:31Preforeclosure Investing: Why You Should Have a Target Area
Many preforeclosure investors spend time and money going after preforeclosure properties, and they end up with poor results. . This happens often because investors take a blanket approach; they look for all preforeclosure properties in their city, for example, instead of focusing on just a few counties. Focusing on quantity rather than quality in preforeclosure investing can keep you from making smart real estate investments in the long run.
Why is it smarter to focus your efforts on a more limited area when looking for preforeclosure investments? You’ll make informed investment decisions.
Here are some tips for becoming a preforeclosure investment specialist for your targeted location:
Choose only a few zip codes for your preforeclosure investing, and become familiar with the real estate market in those areas . This will help you make smart decisions on what to offer for preforeclosures in those areas. You’ll have an idea of the price you can resell them for, and how much the preforeclosures are likely to be worth in the near future.
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04 December 07 - 13:27Real Estate Investing: Getting the Best Preforeclosure Deals
Most people who are savvy at real estate investing would agree that investing in preforeclosure property can yield lucrative real estate profits. But those who reap the best preforeclosure deals are the ones who exercise patience and diligence by shopping around.
When looking for the best preforeclosure deals, here’s what to keep in mind:
Condition of the preforeclosure property – Homes that have been neglected may not be the best preforeclosure deals. To avoid expensive surprises later, always have a professional inspection and assessment of the preforeclosure property you’re considering. The best preforeclosure deals are those that require simple, inexpensive repairs, or repairs that can be done by you. You want to avoid letting your profits be eaten up by the cost of getting the preforeclosure property into saleable condition.
Location, location, location – Though you can find inexpensive preforeclosures in “risky” neighborhoods, the best preforeclosure deals are those in safe, pleasant neighborhoods that will be desirable to potential buyers when you sell.
Profitability – Whether you plan to sell the preforeclosure property for profit, or plan to live in it yourself, make sure that the price is below the property’s actual value. Ensure that you can sell the preforeclosure property – whether immediately, or in the more distant future – at a profit. Otherwise, it’s not a preforeclosure deal; it might as well be just any full-price piece of real estate.
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11 November 07 - 10:55Preforeclosure –5 Other Alternatives Homeowners May Be Considering
Buying preforeclosures can be a highly profitable real estate investing opportunity. If you invest in preforeclosure property, however, (or if you plan to), you need to understand the other options that a homeowner who is currently in preforeclosure or who is facing preforeclosure may be considering.
Forbearance Agreement – A homeowner who is in default, but not yet in preforeclosure, may be allowed to make low mortgage payments or no payments at all for a period of time (commonly 3-6 months). After that period of time, however, the homeowner is usually required to make payments that are higher than the original monthly mortgage payment until the loan is brought up-to-date.
Special Forbearance – If the homeowner has an FHA loan, he may be eligible to postpone making mortgage payments for a minimum of four months to avoid lapsing into preforeclosure. There is no limit to the number of months the homeowner may postpone payments, but payment delinquency is usually not permitted to exceed the equivalent of 12 monthly PITI installments or the preforeclosure process will continue.
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