Profit From Foreclosures
Welcome to the Foreclosure Profit Guide! It is a great time to get into the foreclosure investing business. I want to personally congratulate you on taking the initiative in getting involved in the real estate investing world! With enough persistence you can achieve your goals!
The Foreclosure Profit Guide is provided to you FREE of charge as a guide as well as an introduction in investing in foreclosures. After reading through the future blog posts, you will have a broad understanding of:
1) What a foreclosure is and the steps involved
2) How to find foreclosed properties
3) How to contact property owners in foreclosure
4) How to evaluate foreclosed properties
5) How to sell and generate profit from your investment
Now you may be asking yourself why should I invest in foreclosed properties. The reason is because the amount of foreclosed properties outnumber the amount of investors! It is expected that the amount of foreclosed properties in the near future will hit record numbers! There are several reasons for this:
1) Recession in the current economic state
2) Increasing prices of homes and overextended first time buyers
3) Predatory lending practices
4) Homebuyer’s with an extremely high loan-to-value ratio
5) A recent increase in adjustable-rate mortgages
6) A recent increase in mortgage interest rates.
These reasons have all contributed in some way to the increase in delinquent mortgage payments and subsequent foreclosure of properties. This is why it is essential to get into the real estate investing business NOW than wait until the market is saturated with investors. I Hope this guide will steer you in the right path to making money!
Visit Foreclosure Profit Guide for more free information about real estate foreclosures!
Introduction to Foreclosure Investments
In order to be successful in the foreclosure investing business without taking on unnecessary amounts of risk and paying out lots of money out of pocket, it is imperative to invest in the correct time in the foreclosure process. Let us first define the term “foreclosure.” Foreclosure is “a situation in which a homeowner is unable to make principal and/or interest payments on his or her mortgage, so the lender, be it a bank or building society, can seize and sell the property as stipulated in the terms of the mortgage contract.”
Below are the three steps in the foreclosure process:
1) Pre-foreclosure: The pre-foreclosure stage is the time between when a notice of default is sent to the home owners and when the property is auctioned off to the public. You will learn later that this is the time when you want to invest in order to maximize your profits and minimize your risk.
2) Foreclosure Auction: This stage gives the public the opportunity to bid on the properties that have been foreclosed by the lender.
3) Post-foreclosure: This occurs after the property is foreclosed and is then owned by the lender; often called “real estate owned” (REO). The lender will usually attempt to sell the property through a real-estate agent at fair market value.
Now that you know the stages of a foreclosure, it is important that you know why the pre-foreclosure stage is the right time in the foreclosure process to invest.
1) Avoid competitive bidding at a foreclosure auction, where you are required to buy the property in cash often without being able to inspect the property.
The opportunity to purchase the properties directly from the homeowners, where it is possible to buy the equity in the property at a huge discount.
2) Cannot thoroughly inspect the property. In the foreclosure auction stage, property inspections are often disallowed.
3) Properties in the foreclosure auction stage and post-foreclosure stage are often sold at fair-market value! Therefore, there is no profit potential from investing at these stages.
It is important that you learn and study your state’s foreclosure laws, as it will effect you investing strategies!