Heather Seitz asked:


meowner becomes delinquent on their mortgage payments the lender begins the lengthy foreclosure process. If no attempts are made to reconcile the debt with the lender, then the property is auctioned off at the public courthouse. A single foreclosed property purchased at an auction can easily earn an investor a years worth of investment income. Right now is perhaps the best time in the history of real estate to invest in foreclosures with a record number of foreclosures reported last year. There are plenty of deals available to the general public but the trick is knowing how to find them

Despite what infomercials on television might tell you, investing in foreclosed homes is not as easy as just walking over to the courthouse. There is a lot of homework that needs to be done before a foreclosed home is purchased at auction. The key to successful investing, especially in real estate, is research. What you know can make all of the difference. If you want to be successful with foreclosures you have to be willing to spend some time doing some research

The internet has made performing research of any kind very easy. While researching a foreclosure online you can easily come across all kinds of valuable information. If you are going to be bidding on a property you need to know what the market value of the home is, and there are a number of free online services that allow you to research the market value of a house for free. However, in order to obtain the most reliable data on market values you will need to join a real estate membership site. A membership site will allow you to obtain up-to-date real estate information and foreclosures at a nominal fee.

Foreclosures have a tendency to be in a state of disrepair by the time they reach the auction block. Only a tiny fraction of foreclosed homes that reach the auction block are in move in condition. This means you need to be prepared to estimate renovation costs to the foreclosed property you are looking at. Unfortunately, many states prohibit you to enter a foreclosed home until after the auction is over. If you live in such a state you should consider speaking with a realtor in your area. Chances are a realtor will know someone who was involved in the foreclosure.

With a little research and patience you can easily find foreclosure deals at auction. But if you really want to make a profit with foreclosures you should consider investing in a foreclosure list service. Such a service will provide you with foreclosure deals as they come available and before they reach the auction block. The earlier you buy the property the better.



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Aaron Benson asked:


Do you want to make more money in two or three months than most people make in a year? You can do just that by flipping houses.

What Does it Mean to "Flip a House?"

House flipping is buying a house below market price, fixing it up and selling it for a significant profit. The goal is to get in and get out as fast as possible. You want to avoid as much of the carrying costs as you can. Depending on the price of the house, the monthly payments can eat up your capital rather quickly.

Finding The Right House

You can't make a profit if you are paying retail for a house, so you need to find a house that quite obviously is in need of repair. This makes it easier to negotiate with the seller since they weren't willing to pay to keep the home maintained, it only makes sense that they will have to give that up in equity. The nose is a powerful negotiating tool. The worse a house smells, the lower you can get the price. Even if it is cat poop or a kid with a bed wetting problem whose smell permeates the house, since no one wants to move into a stinky house, the problem will have to be addressed.

You can find the right kind of investment houses by looking into foreclosures, probate, or just driving through the neighborhood and finding a house that appears unkempt and/or abandoned. It's really quite easy if you're willing to do the legwork.

Buying The House

There are many ways to finance a house, but the best way is owner financing, but getting a regular mortgage or working with a hard money lender (since you won't have the home very long anyway) is also a possibility. Dip into your 401K or borrow from your family. Since you are buying a hard asset with real value, if you've done your homework then you'll be able to recoup your money and it's not a high risk venture.

What to Fix

When it comes to preparing the home for resale, you want to spend your money so you are getting the most bang for the buck. While it's tempting to decorate according to your personal tastes, this is not the time to get emotionally involved in a homes appeal. Make your decisions based on what will give you the best dollar return for your investment in the particular neighborhood your house is in. The conventional wisdom is to buy the worst house in the best neighborhood. I've yet to see any evidence that contradicts that advice.

Kitchens and bathrooms are the two top home areas where you will get two to three times your investment back. Kitchens sell houses, so it is important that you use materials that appeal to your potential buyer. For lower end neighborhoods a Pergo floor will add a lot of value, while in a higher end neighborhood you'll have to put in a more expensive tile or hardwood floor in order to sell the home.

Never reduce the bedroom count in a home. That is a sure money loser. Conversely, adding another bedroom to your home or upgrading the Master bedroom can add a lot of value and allow you to increase your resale price.

Take the time to make the outside of the home nice. While your kitchen may be what sells the house, the curb appeal is what draws them in. Plant new sod, add flowers in appropriate areas and give the outside a splash of color. Put in fences and walkways where it will add value. Create a nice backyard living area by adding a deck or patio. When the buyers come around and ooh and ahh, you won't be sorry that you took the time. You'll want to start the outside landscaping and repair early on in the project so it has time to grow and look nice in time for your open house and subsequent sale.

Keeping to Your Timeline

One of the most critical things you must do besides managing your materials budget, is to manage your labor costs by hiring reliable, reputable contractors to do the work you can't do or don't have time to do. Bad contractors can put you far behind schedule and end up costing you much more than they were worth (especially if you thought you got yourself a bargain—you generally get what you pay for). For a $350,000 home every month you hold on to that house your carrying cost of $2,500 each month you are working on a project could have helped pay for getting the house done quicker and with better quality workmanship. Manage this aspect of your project wisely

Selling the House

The sweetest feeling you can imagine comes on the day you've completed all the work and you bring your realtor in to look at the home and pull the comps on homes of comparative value in your neighborhood. After calculating your purchase price, your remodeling costs, your carrying costs and your realtor's commission you should be able to price the home at a price two to three percent below the market (because you'll sell the home much faster and likely get multiple offers) and still bring in a minimum of $50,000 profit. Sometimes I've seen the profits as high as $300,000 on a home that sold for over $1 million. Not bad for two to three months of work

And On To The Next

The decision to flip again often depends on the level of pain one experienced during the flip versus the amount of profit gained on the home. Usually, the profit easily offsets the hassle factor and most people decide to flip again. Some even choose to make it their primary business and build a team to facilitate and support that. Whatever you decide to do, the potential profits are quite high if you do it right and don't get emotionally involved in your purchase.



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Thomas Bladecki asked:


Buying homes at foreclosure auction can make you very large profits. Some investors earn more then $75K on one transaction or you can buy the property for you and your family to live in and save the money. Conditions have to be right and the situation ideal of course to profit this much on a single property, it is possible though to make a substantial living on real estate investing. There is no better time then now, we are in a buyers market, with the increase in foreclosures in the US, there is an overwhelming number of "deals" available, you just need to know how to find them.

Investing in foreclosure bargains is not easy to do; some people make it sound like you simply walk over to the courthouse and make the deal. However, the trick is to purchase the home before someone else makes it his or her investment. Becoming a real estate tycoon is not about what you can afford, or what you are willing to spend, it is about the valuable information that you learn about a property. Research is a key factor to being a successful investing in the real estate industry.

While researching a potential foreclosure purchase, you need to find out some valuable information about the property. What you are willing to pay for a property and sticking to your limits is a great start, do not bid more then your research shows you should pay for the property. For example, if you research a foreclosure that has an estimated value is $250,000, once you deduct your renovation costs of say $30,000, this would still leave potential if you can purchase the home at auction for $140,000. Do not forget to calculate in the carrying costs, realtor fees and other expenses as you work out the budget and profitably of the purchase. Investing in foreclosures is about business, you are in it to make money, so make sure that you do your homework.

There are several key things to look for and research when looking purchase a foreclosure. Location is one of the firsts; it must be in a decent area if you expect to resell the home for a profit. General amenities such as grocery stores, banks, restaurants and other useful businesses is another thing to look for. People do not like to travel to far from home to get the basis things that one needs to live. The current market conditions play an important factor as well. If the employment opportunities are in distress, buyers may look elsewhere for a home.

Foreclosure listings can help you find properties that are in various states of foreclosure, the newest listing, in most cased, will allow the best opportunity to get buy them before someone else does. There are a growing number of websites that offer listings to homes in foreclosure; some sites give the basic information free, while most of them charge an access fee to obtain the detailed information such as lenders, default amounts and preliminary dates for auctions. This type of information is vital to the success of purchasing profitable properties; most of them will disclose secondary liens or judgments against the property that need to be resolved.

Wining a property at a public auction is not easy, but it is not impossible either. Proper and thorough research will go a longs ways in getting to the bottom of what you can and should pay for a foreclosure at auction. Set a budget, do your research and if it all works out on paper, then make a bid. Success at the auction is only, success, if the numbers work out and the property offers the profit potential that you have set your mind too.



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Joseph Lane asked:

People will agree and disagree allot about when the real estate market will recover completely from the current high rate of foreclosure predictions for the next 2-3 years. Many may shy away from the market simply because they don’t want to get to involved with the market if it doesn’t look promising. The real estate market is always shifting different ways, Currently, due to some loans that were approved a few years back, many of those loans were acquired with payments that could change in the future and many of them did and the house owner could no longer afford the new payment and then many slipped into foreclosure.

With all the houses that are returning to the marketplace, there could be many opportunities to flip a house. Sure, many deals will still lack attraction but with the sheer volume of real estate property deals on the market, it will be a buyers market and for the agents who research enough, their will be some good house flip prospects. A Real Estate coach is recommended if you need help. For those unfamiliar with the term "Flip This House", it is a show on the A&E channel hosted by Armando Montelongo. The show has taught and introduced many people into the realm of buying and selling houses; known as 'flipping houses'.

With the market being flooded with properties, house flippers should start their engines because its a good time to buy and sell properties if you plan well in advance and your financial planning includes backup paths to selling the property. Montelongo House Flip style real estate is a popular way to get involved with the buying and selling of properties for quick profit.

In 2008 to 2010, it will be an era where a person will need to really have a good plan upfront so to address and situation that may arise after they buy the property. Even though the market is not great now, it is still a viable time to make money on the market if you do your homework. Remember, get a Real Estate coach is recommended if you need help. Information, experience and guidance are priceless assistance available to you.