Step #1 – Look at the Property
Let’s assume you found a property from one of the foreclosure sites I mentioned in my previous post “How to Find Foreclosures – Where Do I Start?” or in a legal notice from your newspaper. You’re excited with the information you read about the property and you’re ready to start doing additional research. At this point it’s a good idea to go look at the property before you spend any of your time processing the legal work. Until you do that, you don’t even know what the neighborhood looks like, the condition the property is in, and if it’s vacant or not. If you don’t know these simple things about the property, you’ll never know how risky of an investment it could or could not be.
What happens if the legal description or foreclosure notice you read doesn’t list the physical address? You have a couple options like contacting the title company and asking them to lookup the street address, calling the attorney that’s managing the foreclosure, or go down to the courthouse and look it up. Once you get the address, you can continue reading below.
Once you arrive at the property you’re only able to in most cases, view the outside of the home. You really need to see the inside if you are to properly make a decision and this is always extremely difficult because it’s not like an open house. There are several options here and it really depends on your judgment and comfort to be able to have a peek inside. Your options are to walk up the steps and knock on the door and see if anybody is home, if the house looks vacant or abandoned maybe take a quick walk around the property and peek through any windows without disturbing the neighbors, or just walk away and look for a different property. Now I’m not suggesting you trespass nor illegally enter a property and that’s why I said use your judgment. If it’s nighttime and you’ve got a flashlight it’s probably not a good idea to wander around the property unless you want the local authorities coming by to meet you.
Let’s say you were able to see the property and got a nice glimpse of the inside. You felt it’s a good prospect to bid on. Your next step is determining what it will appraise for. I’d recommend you hire an appraiser, realtor, or another investor who has more experience to help you pin down an approximate price on what it will appraise for. There’s a good chance depending on if you were able to get a glimpse of the inside in the previous step, that the appraiser will not be able to look at the inside and only give you a rough appraisal based on what he or she can see on the outside. Of course, there are exceptions, and you might not be too disappointed if you trust just the condition of the outside.
Stay tuned for step #2 – Contacting the Trustee
Of course you can make money flipping real estate in more than two ways. But when it comes to actually repairing and improving a house, there are two different approaches that are very different. You can do do as much of the work yourself as possible. That’s one approach. The other? Manage the project while others do all the actual repairs and other work.
Some investors will say that your time should be spent finding and managing properties, not painting or hammering nails. Otherwise you’ve bought yourself a job, they will tell you, rather than an investment. Although I tend to agree with that idea, nothing is that simple and definite. You can make money flipping real estate either way, and there are reasons for both approaches. Continue reading Make Money Flipping Real Estate – Two Ways
The first two tips for flipping a house are not about what to fix or change. They’re about time and money. Specifically, they are about how time costs money, and about how to determine how much to pay for your “flipper” in the first place. Read these first two carefully then, to make sure that you do this right.
1. Know Your Numbers
How much will the house sell for when it is ready? A clear idea of the ARV (after repair value) is necessary to safely make an offer on a property. Don’t just guess that you’ll sell the home for $20,000 more than what you put into it. You don’t decide what a home is worth – the market does, so get advice if necessary. Then subtract from the ARV all possible costs you will have, including price, buying costs, repair costs, holding costs, and the costs of selling. Now subtract the profit you want, and you have the highest price you should pay. Start with an offer lower than this, of course. Continue reading 6 Tips For Flipping A House
The most important issue in the entire foreclosure process is that of how long it will take from the first payment being missed to the eviction of the homeowners. It is also an issue that most foreclosure victims have no idea about, and spend more time worrying about than any other aspect. Without knowing if or when the process has started, when the sheriff sale will be conducted, and how long they have after the auction until they are removed from the property, homeowners feel they have little control over the situation. Having a firm idea of the time frame of the foreclosure process, though, will allow them to put together reasonable plans to stop it with the time they have available.
The timeline of the foreclosure process will depend almost entirely on the state laws, so homeowners in danger of missing more than one mortgage payment should look those up as soon as possible. Various time lines are determined by the state, including notices that must be posted or mailed, redemption periods after the sale, and the scheduling and confirmation of the sheriff sale. Even procedures for postponing a sheriff sale are determined by the state laws. All of these aspects will be taken into account for the actual time that foreclosure victims have available to save their homes. Continue reading Foreclosure Timeline – How Long Does it Take?
Google now offers a full suite of tools for real estate professionals that let you reach prospects in your region at all stages of their home search – while they’re looking for properties, checking out locations, and selecting an agent or broker. These tools have actually been around for a while and Google is just repackaging and positioning them for real estate professionals.
The tools they are referring to are Google Base, AdWords, Maps, Earth, Local Business Center, Google Sketchup, and Google Apps. It’s actually a great idea and it shows how flexible Google’s products are that they can easily cater to specific industries like real estate. Their overall message is that Google can help generate real estate referrals and leads to help connect to home buyers and sellers since Google has more real estate searches than other search engines combined.
So are these tools actually helpful for you, the real estate professional? In short, yes but not all the tools in the suite are exactly easy to use. Here’s a quick rundown of what each tool is for and it’s ease of use. Continue reading Google Tools for Real Estate Professionals
Why buy apartment buildings? Well, you should get more cash flow than with rental houses. Of course, big projects do take more time and research and cash, but then they pay you for year after year.
It is easier to start investing in single family homes than apartment buildings. If you have done so, however, you have noticed how difficult it is getting to get positive cash flow from houses. Even if you do squeeze a little out of each, it can take a lot of them to have a decent income.
Like in a Monopoly game, at some point you may want to trade in your little green houses for a big red apartment building. One apartment building may provide as much cash flow as twenty little houses. And once you have management in place it may be a lot less work. Continue reading How To Buy Apartment Buildings
Let’s say you’ve spent lots of time learning about real estate investing and finally started looking for properties. You end up finding a potential investment property and now you want to know if it will be cash flow positive. Sure, you could plug all your numbers into an excel spreadsheet and setup some formulas but I’ve got a better option for you.
There’s a free online property analysis tool where you can create, save, and print graphical reports displaying rate of return, cash flow, expenses, and more. I use it all the time whenever I come across a potential investment property even if an APOD (Annual Property Operating Data) is provided. It’s web-based so I can input and access the data from anywhere while I travel. Continue reading Free Real Estate Investment Software
The housing market is just getting worse. Home resales tumbled 8% in September to the lowest levels in this decade, prompting the obvious question: When will it all end?
The honest answer is no one knows. Optimists have been saying for more than a year that the worst is behind us, while the pessimists have been saying recovery is still a year, or years, away.
So far, the pessimists have been right about the weakness in the housing market, but their forecast that the collapse in housing would lead to a general economic malaise has, at least so far, failed to pan out. The economy has slowed, but has not fallen into recession, as consumers and investors adjust to a world in which home prices don’t automatically rise 5% or 10% a year. Continue reading When Will the Housing Market Finally Hit the Bottom?
The lure of making money by investing in foreclosure properties has too many times led to real estate professionals taking advantage of homeowners facing the loss of their homes. Their focus on reaping huge profits from these properties causes them to lose sight of the moral and ethical side of doing business and providing a helpful solution to assist foreclosure victims. In response to these practices, some states have begun regulating how investors and foreclosure help companies do business in certain situations, including profit-capping measures for investors and fuller disclosure requirements in the area of loss mitigation. In addition, courts have ruled that, in some cases, the popular rent-back or leaseback option counts as a loan to the former foreclosure victims, rather than a rental agreement, forcing the investor to foreclose on the property again if the renters fail to pay as agreed.
While these laws provide further regulations that reputable foreclosure experts must now follow, the foreclosure scam companies will continue to do whatever they can to take advantage of homeowners in foreclosure. Many of the worst of these companies do not even bother to research the relevant foreclosure laws and rely on homeowners to fail to gather their own foreclosure information. In essence, they rely on their own ignorance of the law and the foreclosure victims’ ignorance in order to prey upon homeowners. This presents a unique opportunity for legitimate foreclosure investors and companies to fill this void by educating foreclosure victims on what can be done to stop foreclosure legally and effectively. Continue reading How Investors Can Create Local Solutions to Foreclosure
During the height of Las Vegas’s real-estate boom two years ago, property investor Rob Rozzen bought 16 homes, hoping that skyrocketing prices would pump up his retirement nest egg.
Now, Mr. Rozzen says he is considering filing for bankruptcy protection. As the housing market slowed, the 40-year-old was unable to sell the homes, and his full-time job as a real-estate agent was no longer able to support mortgage payments totaling $45,000 a month. So one by one, over the past 14 months, Mr. Rozzen has stopped making payments on his investment properties, for which he paid between $226,000 and $390,000, and lenders have foreclosed. Continue reading Las Vegas Real Estate Investor Loses 16 Homes