 |
|
|
An Educated Investor is a Smart Investor
By David Offut, Exit Realty Plus
As a real estate broker and investor, I know how important it is to have a
finger on the pulse of the investment market - especially when it comes to
investing in foreclosed properties. Knowing the foreclosure process inside
and out is very important, especially knowing how foreclosure laws differ
from state to state. The more I educate myself, the more I can educate my
clients and help them make profitable investments. The more they exhibit
confidence in me, the more able I am to demonstrate my knowledge without
overwhelming them with too much information.
Recently, I looked at a 3-family in Brockton that was in foreclosure. At
first glance, it looked like a great deal for one of my clients. As I dug
deeper, keeping a sharp eye out for danger signs, it became fairly evident
that this property wasn't likely to yield a great profit. Tenants were
going to have to be removed, which is an expensive process and wasn't
going to be easy. Unless you know from personal experience or have
learned about tenant removal through courses run by industry experts, few
anticipate how difficult a process this can be. I told my client to walk
away.
Due diligence is a very important step in acquiring a foreclosed property.
Other clients of mine were so excited to find a single-family home in a
desirable area of Canton for short money that they wanted to buy the
property immediately. They were afraid they were going to lose it if they
didn't act quickly. I cautioned them against jumping in too quickly
without doing their due diligence. Reluctantly, they went through the
process of having the home inspected. What we uncovered were rodents -
lots of them. Easy to fix? One might think so, but in this particular
case, all of the floors would have had to be ripped up and replaced. Sure,
my clients were disappointed not to get the property, but it was the right
decision to walk away.
There are so many components involved when buying foreclosed property. It
is a much more complicated process than buying a regular piece of real
estate, but it can be much more profitable. You have to be careful since
so much is unknown and time is short. It is important to get your data
early. Contacting the homeowner can be not only a tricky, but a sensitive
situation. What works and what doesn't? When you finally find the perfect
deal, you have to know how to make it work for all parties involved,
including the bank or investor. Many people go into a deal unprepared and
find out that they can't carry the property. How do you know if the
numbers work? A lot of strategy is involved when making investments. As
Kenny Rogers says, "You have to know when to hold them and know when to
fold them." So, when do you flip a property and how? What are the tax
implications? These are just some of so many questions one has to ask when
getting started in foreclosures.
* Next 37 17 investors only!
Having good business sense is crucial. Knowing the right people to talk
to also makes a big difference. Although there is so much involved in
foreclosure investing, it can and has been done profitably. I've done it.
If you'd like to learn more about how to see a deal through to the end, I
invite you to join us on July 23rd for a full day seminar on Opening the Door to Profit
and learn first hand how I opened the door.
David Offut is the principal of Exit Realty Plus in Brockton. You can
reach David at 508-942-4110 or visit his website at askdavid.net.
Did you like this article? You May Also Like:
 |
Feature Article: How to Become Financially Literate - Without Getting a Degree in Finance
Ann Bellamy
Think you need a finance degree to understand the real estate "numbers" game? Think again. Ann Bellamy, real estate investor and hard money broker, gives you seven tips on how you can become financially literate and comfortable with real estate investing. (Hint: Don't be afraid to take chances.)
|
 |
Feature Article: Appraising a Property Without Stepping Foot on the Premises
Steve Krasnow, Certified Residential Appraiser
Determining a property's value in order to make the right offer or bid takes practice and experience. Knowing how to evaluate a property when you dare not step foot past the boundary line is another whole kettle of fish. In this article, Steve Krasnow gives four strategies for determining value - without having to tour the property.
|
 |
Success Strategies: Six Tips for Buying Properties at Traditional Auctions
Kevin Norton
Traditional auctions aren't for the faint of heart; purchasing properties as-is at auctions can be risky - unless you know what you're doing. A 13-year veteran at the auction game, Kevin Norton gives you his top six strategies for buying properties at auctions - including how to determine value without using an appraiser, how to place a winning bid, and what to do if you get cold feet after the fact. (Sign your name the right way and you can offload that property to another investor. Really.)
|
 |
Feature Article: Note Buyers Help Investors Seal the Deal
George Riley, Genesis Funding Resources
One of the common reasons investors look towards foreclosures is because foreclosed properties can be purchased for below market prices. One of the ways you can further a negotiation along is by asking the seller to "hold paper"...
|
 |
Feature Article: The Five Biggest Mistakes Made at Property Auctions
Dale Schaetzke
As foreclosures increase in numbers, auctions are sure to do the same. Bidding successfully however, is not as easy as it may look. Read on as auction expert Dale Schaetzke explains the most common errors and offers insights into how to avoid them.
|
 |
Success Strategies: Working with Plumbers, Electricians, and HVAC Types
Michael Farmer
Unless you use the services of a property manager, owning a rental property means you're responsible for maintenance and repairs. If you're all thumbs when it comes to toilet seals and the like, you'll have to call in the "trades" to help. Veteran contractor Michael Farmer tells you how to find good trades people you can trust - and how to ensure you get what you pay for.
|
 |
Feature Article: How Green Light Realty Exploded Profits by Documenting Business Systems
Don Armstong, Green Light Realty
Working with E-myth coach David Hilton, Don Armstrong put in place documented systems that has helped him run his business more efficiently, lower his costs, generate more leads - and close short sales 93% of the time. Don takes you inside the experience of working with a professional coach and explains three of the steps he took to transform his business.
|
 |
Success Strategies: Negative Amortization - Useful Tool or Risky Tactic - or Both?!
Trish Signet, Loan Officer, Summit Mortgage
With interest rates rising steadily over the last few years, it's become harder for property investors and others to make the numbers work. Negative Amortization mortgages may offer an alternative, but as Trish explains, buyer beware.
|
 |
Feature Article: Not Going Anywhere Fast? It's Time to Hire a Coach!
David Hilton
If you've played on a sports team, you know the value of coaching: a good coach builds your confidence and helps you become a better athlete. A business coach does the same thing. Veteran E-Myth consultant and coach, David Hilton, explains the coaching process, how it can dramatically improve your business, and most important, how it will help you change your perspective - and change your life.
|
 |
Interview with the Expert: Real Estate Savvy Financial Planners Can Save You Big Bucks!
Eileen Schwartz, Real Estate Investor
Let's say you want to pay off your mortgage and buy the retirement home of your dreams by selling one or two of your investment properties. What most people don't consider, explains financial planner and real estate investor Eileen Schwartz, are the tax implications of these real estate transactions. In this interview, Eileen discusses why working with a financial planner who also understands real estate (including 1031 exchanges!) can literally save you big dollars - now and in the future.
|
|
|
