The Basics Of Foreclosure Investing
A few years ago, many consumers are against buying foreclosed homes
. According to some of them, one shouldnt take advantage of the misfortune of others and buying a repossessed property is like doing exactly that. However, with the passing of time comes a shift in the attitude of home buyers. According to a recent survey, more Americans are now open to the idea of
foreclosure investing.
Investing in foreclosed properties allows ordinary home buyers and real estate entrepreneurs to make the most of their home purchase. It also provides them with the opportunity to obtain good investment properties at affordable prices.
If youre considering buying foreclosed homes, you might be thinking when the good time to buy foreclosures is. To answer this particular question, there are three stages in which you can purchase such properties.
The first stage is called the pre-foreclosure phase. In this stage, the bank has already sent a notice of default to the homeowner but has yet to take control of the property. This is the perfect opportunity for a buyer to obtain a foreclosed home because both the bank and the homeowner are considering options to prevent the property from undergoing repossession. The bank may accept your offer to do a short sale because it prevents the lending institution from paying hefty fees, which is usually a common aspect of the foreclosure process.
You can also try foreclosure investing during the second stage of the foreclosure process, wherein the bank has already repossessed the property and is trying to sell the house at an auction. When participating in a foreclosure auction, be prepared for bidding wars, especially if youre determined to obtain the property that is set to go under the hammer. If the house in question has great marketability and profitability, chances are, other investors and buyers would also be interested in obtaining the property.
If you dont want to experience the hassle of participating in bidding wars, you can buy investment properties right after the bank has taken legal ownership of the distressed property that you want. At this stage, the foreclosed house has become a bank owned property. Popularly known as REOs, bank owned homes are foreclosed real estate that werent sold at the auction. The problem with such properties, however, is that many of them lack equity.
Foreclosure investing is a great way to acquire investment properties and maximize the value of your money. If you want to learn more about buying foreclosed homes, you can go to
www.REIwired.com.
by: Dan Ross
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