How To Make Money On Foreclosures
More accurately How do you make money on foreclosures when they are over bought or when their value is equal to or less then the mortgage.
More accurately How do you make money on foreclosures when they are over bought or when their value is equal to or less then the mortgage.
mortgagee approved, preforeclosure short sale
[addsig]
I increase the value of the property. It usually is destroyed when I get it.
Lori
[addsig]
A mistake is to overpay. If the deals are selling for more then they are worth you should likely pass. Note who bought them as they may become distressed sellers later.
As Lori mentioned consider improvements or change of use. This will mean more money to invest so make sure the market is there after the improvements.
Slightly off topic but as someone else has noted, if the foreclosures are selling for too much, look somewhere else. Earlier in the cycle (pre-sale) or a change of market strategy (location or type).
Never over pay as you are just passing your potential profits to the seller while taking on a large time commitment. Better to spend the time looking for a deal that does have a profit in it.
John
[addsig]
Do you find that you can deal with the lender and negotiate a discount or will lenders opt to go to auction.
Also how can you deal directly with the lenders, I have had the expeirence that they do not speak with investors.
What are the most common strategies you use to purchase a property. I have no trouble locating them, it is the purchase and negotiation I find difficult ofter the home owner and/or lender will not speak to me.
Before i weigh in here, I'd like for you to be a little more specific in your question.
Exactly what type of properties are you looking at? Are they actually foreclosed homes, where the bank has already took possession of them (REOs), or are you looking for PRE-foreclosures, where the sellers/owners are in some stage of the foreclosure process?
These are two completely different things and needs to be clarified before you'll get good answers.
Roger
Property type - Residential single family home.
In this particular instance it is Pre-Forclosure, the bank has hired lawyers and has filed a lis pendens.
Although REO's are interesting to me as well