What is Foreclosure?

Foreclosure is a process that allows a lender to recover the amount owed on a defaulted loan by selling or taking ownership (repossession) of the property securing the loan. The foreclosure process begins when a borrower/owner defaults on loan payments (usually mortgage payments) and the lender files a public default notice, called a Notice of Default or Lis Pendens. The foreclosure process can end one of four ways:

1. The borrower/owner reinstates the loan by paying off the default amount to during a grace period determined by state law. This grace period is also known as pre-foreclosure.

2. The borrower/owner sells the property to a third party during the pre-foreclosure period. The sale allows the borrower/owner to pay off the loan and avoid having a foreclosure on his or her credit history.

3. A third party buys the property at a public auction at the end of the pre-foreclosure period.

4. The lender takes ownership of the property, usually with the intent to re-sell it on the open market. The lender can take ownership either through an agreement with the borrower/owner during pre-foreclosure or by buying back the property at the public auction. These are also known as bank-owned or REO properties (Real Estate Owned by the lender).

This process allows for three opportunities for finding bargains on foreclosure homes.

Pre-Foreclosure (NOD, LIS):

Buying a property in pre-foreclosure involves approaching the borrower/owner and offering to buy the property outright. The borrower/owner can walk away with something to show for any equity in the property and avoid a bad mark on his or her credit history. The buyer has time to research the title and condition of the property and can realize discounts of 20-40 percent below market value.

More about pre-foreclosures

Auction (NTS, NFS):

If the loan is not reinstated by the end of the pre-foreclosure period, potential buyers can bid on the property at a public auction. Buyers often are required to pay in cash at the auction and may not have much time to research the title and condition of the property beforehand; however, a public auction often offers some of the best bargains and avoids the unpredictability of dealing directly with the borrower/owner.

More about auctions

Bank-owned (REO):

If the lender takes ownership of the property, either through an agreement with the owner during pre-foreclosure or at the public auction, the lender will usually want to re-sell the property to recover the unpaid loan amount. The lender will then typically clear the title and perform needed maintenance and repair; however, the potential bargain for these REO homes is typically less than a pre-foreclosure or auction property. Bank foreclosures can become government foreclosures if the loan is backed by a government agency such as the Department of Housing and Urban Development (HUD) or the Department of Veterans Affairs (VA). In that case the government agency would be responsible for selling the property.

More about REOs

Before you buy

You’ll need to make sure you’re armed with the resources you’ll need to find and buy foreclosed homes. You can start by searching free on foreclosuredata, which includes pre-foreclosure and auction properties across the country and a nationwide bank foreclosures list.

Find out more about buying resources.

Sheriff’s Sales

Buying foreclosure properties at the Sheriff’s Sale (or Auction as it’s commonly known) is one of the best and quickest ways to make big profits in the distressed real estate business. However, it can also be the easiest way to lose.

The sale of a property comes at the end of the foreclosure process when the defaulting property owner cannot repair their financial problems with the lending institution.

There are 2 types of foreclosure, “judicial” and “non-judicial”. In basic terms, the “judicial” process requires the lender to file a suit against the borrower and the “non-judicial” process does not. The judicial foreclosure is a much more lengthy process due to the restrictions and schedules set forth by the courts. For our purposes, we will focus on the “judicial” process since it is the method used in New Jersey.

The process starts with the mortgage document, a security instrument used to pledge the property as protection against the loan.

When a default occurs, the lender attempts to end the homeowner’s rights of possession. The lender must file suit and prove in court that it has the right to sell the property to recover its loss by virtue of the default and as stipulated in the signed security instrument. If awarded a final judgment from the court, the mortgage company will proceed with the foreclosure process and the property will be scheduled for sale.

The properties are sold at public auction under the direction of the court in the county where the property is located. The winning bidder of this auction will receive clear title to the property (excluding taxes owed and other municipal liens, more on this later). About 80% of the time the successful bidder is the lender, the original mortgage holder.

Attorneys are usually there to represent the lenders in the bidding process. Get to know these attorneys because they can provide you with the judgment amounts and other information before the sale, giving you extra time to plan your strategy. There will also be investors, onlookers and other curious individuals observing the proceedings.

Occasionally, a lien holder of the property will appear trying to salvage what they can from their remaining interests. Rare but certainly possible, the homeowner may show up to bid on their own property. Remember, the owner has 10 days to redeem the property for the full judgment amount. In the event of redemption, all prior liens will become active again. In other words, it’s like reversing the foreclosure process; you’re back to where you started with only the foreclosing lien holder paid off.

find out more about sheriff sales and foreclosures here

Rewards

The biggest reward to buying properties at the Sheriff sale is the high profit potential. If there is a substantial difference between the fair market value of a property and its final judgment amount at sale, you can really win big. Typically, the largest monetary rewards will come from the proper application of this investment method.

Sales are usually advertised 4 – 6 weeks in advance. In some counties, this information may be available 6 – 8 months or more before the sale (tip –information available this far in advance can drastically differ from the properties that eventually end up at sale because the owners are only 3-4 months behind at this point and it is relatively easy to cure the default). By the time they reach the sheriff’s department you have at least 1 month before the sale.

In New Jersey, all owners are entitled to 2 adjournments for a period of 2 weeks each. The owner can take them all at once or in 2 separate intervals, usually giving you 2 months from the publication/release date to do your research.

You will need to research the property, the condition of the loan and the condition of the owner. Why the owner? If you can work out a satisfactory arrangement with them, you might be able to save yourself the trouble of going to the auction. If you meet with the owner and cannot work out a deal, take careful note of the property’s condition while you are there. This will give you a competitive advantage over other bidders at the auction.

You should go to the courthouse and observe the process a few times before going to bid on your property. It’s certainly a good idea to familiarize yourself with the local auction process.

For instance, certain counties do not announce the judgment amounts of their properties and if you are not careful, you might end up paying over the amount necessary to purchase.

Drawbacks

Buying at the courthouse can be very dangerous for those who do not do their research properly.

The large cash outlay required to buy the property is the biggest deterrent for most potential bidders. Certified checks and sometimes cash will be required to bid on these properties (call ahead to find out details).

Generally, you usually have to pay off the sale amount within 30 days from the date of purchase. You may not be able to inspect the property before bidding on it. In this case, there is little chance you will be able to assess the property damage and replacement costs. This ends up hindering your ability to determine true market value, maximum bid amount and potential future profit.

If you happen to be the successful bidder, you may have to evict tenants currently residing in your new property. This could take several months (typically 3-4 in New Jersey). This also interferes with your plans to repair and quickly sell the property for a profit. This delay increases your carrying costs (monthly payments and other bills) and erodes your profits.

At times, there may be land use problems with a property such as zoning or environmental issues like petroleum contamination or toxic waste. A clue to avoiding a problem property is when the lender’s representative fails to appear or bid on the property. If the lender does not want it, then you do not want it either.

Failure to research properties leads to over-biding at the sale. Too often properties are purchased for much more than their value. This, accompanied by the tendency to get caught up in the heat of the moment and over-bid, known as ‘’auction fever’’, results in large over-payments and even larger future losses.

Your most important concern should be the possibility of other liens or judgments. As the successful bidder, you replace the homeowner’s position in the property. Any municipal liens and previously owed taxes will also have to be paid. (The foreclosure process wipes away all secondary liens such as mortgages and judgments except for taxes and specific municipal liens)

Make sure you listen to the announcements being read by the representative for the lender. The announcements typically have all owed taxes and municipal liens that are included with the sale. If a lien shows up that you were not aware of, you might change your maximum bid price at the last moment.

The first mortgage holder is not the only one who is foreclosing properties. If a third lien holder forecloses, the process will not wipe out the first and second lien holders. Buying this property means you buy these liens as well. Typically, first mortgages are the largest liens on properties.

Researching Properties

The only way to be sure that this is a first mortgage holder foreclosing is through a full title search. The cost of the search is minimal compared to the potential loss from not investigating the condition of the title.

Evaluate the properties and determine their profit potentials. Do this by determining the market value using comps, appraisals and brokers’ opinion of price. Call the local tax collector to find out if there are any taxes owed or even tax liens on the property. Find out if the town also provides water/sewer. If so, inquire about outstanding bills. Subtract the final judgment amount, taxes and municipal liens from the market value. If there is a significant difference, you may have a winner.

Inspect the property if you can and assess any damages or repairs you might have to make before re-selling the property. Deduct those expenses from the profit you calculated earlier.

Calculate your profit potential by starting with the price you can sell the property for in its final condition. From this amount subtract any repair expenses, costs you will incur while holding the property (loan payments, taxes, insurance), closing costs you will incur when you sell the property, the broker’s commission if you intend to sell your property through a broker and other taxes and/or municipal liens.

Your sub-total so far, is your expected sale price of the property known as, the ‘”‘net to you’”‘ after you sell.

Deduct the default or final judgment amount from your last sub-total. This is your gross profit potential, hypothetically the most you can make assuming all goes well.

Determine your maximum bid amount. The lowest you can bid is the final judgment amount. The highest you bid is the ‘”‘net to you’”‘ amount. Any amount over that break-even point results in a loss. Determine the minimum profit you want to make and then subtract your desired profit amount from the ‘”‘net to you’”‘ figure. That is your maximum bid amount.

Going to the Sheriff’s Sale or Foreclosure Auction

Prepare for the auction by phoning ahead to find out any details and to make certain that the sale hasn’t been postponed. Determine the requirements for purchasing properties, how much deposit is needed, when the balance is due and what type of payment is required.

Attend the auction and arrive early. Properties are sold very quickly, sometimes within minutes. Pay attention and register yourself as a bidder if necessary.

Listen carefully for your target property to be announced for sale. Observe the bidders. Know your competition. Do not announce your intentions to anyone there. Never bid more than your pre-determined amount.

The successful bidder will receive a deed, the type of which depends on who is conducting the sale and state law. Record your new deed and obtain title insurance as soon as possible.

Remember to research properties and their liens thoroughly. Calculate your expenses and profit margins. If you cannot inspect a property, leave yourself a little extra room and some extra cash.

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About the Author
Author: James Hall

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Reality is that it won’t, and as an investor interested in buying foreclosures, the hardest part can be convincing the homeowner that they really are going to lose their house unless they do something about it. It can also be difficult to convince them that you really are trying to help them, even though you are helping yourself make a profit at the same time.

When you’re dealing with foreclosures, time is of the utmost importance. You need to have enough time to bail out the homeowner and take over the property before it’s too late. That’s why it can be a good idea to subscribe to a foreclosure listing service – you get access to listings at the earliest possible time, and don’t have to use your valuable time looking for potential foreclosure properties from other sources.

Many people facing foreclosure have spoken to an attorney, and are convinced that bankruptcy is their only option. In most cases this isn’t true, but attorneys tend to stick to what they’re familiar with, which is bankruptcy, rather than mentioning other possibilities such as:

- Sale by assumption
- Deed in lieu
- Straight sale
- Foreclosure presale
- Compromise sale
- Short payoff
- Workouts
- Assignment
- Injunctions

There are still more options than these, which shows that bankruptcy definitely isn’t the only choice for the homeowner. When you’re dealing with a homeowner in foreclosure, make it clear that you’re offering an alternative to bankruptcy. Find out whether they really understand what bankruptcy will do to their credit history and how it will affect their future.

If you’re serious about buying foreclosure properties, then you need to become familiar with everything that’s required in the process, and check everything for every property you consider. These items include:

- Loan and mortgage documents
- Loan amount, monthly payment, and interest rate
- Any outstanding taxes
- Existing insurance policies
- Any other liens or judgments

Make sure you have enough information to complete all the necessary tasks before the foreclosure occurs. If there’s not enough time, don’t even bother starting. Having said that, learn as much as you can about ways to delay foreclosure, and help the homeowner to implement them all. If may just give you enough time to take over the property before the foreclosure auction.

Above all, focus on creating a solution where everybody wins. It’s never an easy time for the homeowner, so be prepared for plenty of anger, frustration and resentment – some of which may be directed at you. Walk away if it’s obvious the person doesn’t want to work with you. Find someone who is interested in finding a solution, show empathy for their situation, put together a strategy to get the best possible result for them, and before long you’ll find yourself with a good portfolio of investment properties.

About the Author
Author: David Jacobsen

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Foreclosures continue to make the headlines accross America. DataQuick foreclosure statistics showed the pace slowed slightly, with September foreclosures reduced 8% from 243,000 in August. The reason so many people are writing and talking about the numbers is because they are more than double the pace of t2006 – with all indications that there are still many more to come.

Many people think of foreclosure investors as being “bottom feeders” or parasites – taking advantage of the misfortunes of others. Others view them as being a necessary evil – or safety net that will help to adjust the market price and stabilize the real estate market. Whatever you think, someone must buy these properties. Just as “vultures” have their place in the natural ecosystem; so too foreclosure investors have a place in bringing some sanity and stability back into a real estate market that had become a feeding frenzy of over extended buyers driving ever higher prices in already over heated markets.

It appears that the expected recovery will consist of three stages.

1. The mortgage credit industry needs to clean up their act and stop making loans that will likely result in defaults. This is already well under way.

2. The non-performing loans need to get resolved – if this means foreclosures then the sooner this process is completed the sooner we can see signs of recovery. There appear to be several more months of this phase.

3. Foreclosure investors may be able to get bargains and then rent or re-sell the properties at market prices that fit the credit profile of the new owners, thus, stabilizing the market. This also appears to be in the early stages so there should be more opportunities for profit in the next several months.

How much will the prices come down & are there really any bargains?

We have been studying data from several regions of the country. Data Quick and RealtyTrac are two main sources of this data. In our unscientific study we found that the discounts on distressed properties are currently in a range from as low as 15% in Hawaii to over 40% in a few markets (AL,OH,PA) with an average of 20 – 25% across the board. Of course this raises two more pressing questions. How much farther will prices drop before they reach the bottom? The answer is, of course, nobody knows for sure, however, most experts are telling us that they believe the bottom will be 7% – 17% lower than today’s market prices. This is where you must use your best judgment in each market place and realize that there are differences between neighborhoods even in your area. The second question is a natural. How do you find bargains in your area?

How to Find a Bargain

To locate foreclosures in your area, RealtyTrac is a good place to start. Their website lists foreclosures by ZIP code and foreclosure stage, ranging from pre-foreclosure property to bank-owned real estate. RealtyTrac is a web based service which provides you with the basic information you will need to locate distressed properties.

Many I’ve spoken with report that they find RealtyTrac data not to be totally accurate. Let’s face it the task of keeping up to date is enormous and the information entered on county records is not always correct. With the huge numbers of new defaults mounting it makes the job nearly impossible. Even so, you can use this service to locate potential deals. RealtyTrac charges you $49.95 per month for their updates and they allow you a free test drive for seven days.

More Sources of Bargains

REO’s Bank Owned Properties. Banks and mortgage lenders are not really in the Real Estate investing business. In fact they are really in the lending business and they want to collect interest on loans and the fees they get for servicing and so forth. But, they must deal with the large number of defaulting loans. Unfortunately for banks, many are not permitted to keep these non-performing assets on their books. This creates opportunities for investors to buy the banks’ problem properties. But, buyer beware; do your homework and make sure that you understand you will be buying “As Is” unless you manage to get thebank to fix the property before you take it over. You may find properties for sale on the banks’ own Web sites: Bank of America, Countrywide and U. S. Bank each have some. We’ve found over 200 listings in California alone priced under $200,000. Carefully selected properties can create some nice equity and upside for savvy investors.

Local real estate agents and brokers. Often, the best source of information and access to buying and selling property in any area of the country is the local Realtor. All good agents have refined their network over time so that thy will know about what is coming on the market before you may be able to find out. If you develop a few good contacts, they can act as your eyes and ears to find the best deals.

Auctions. Auctions are increasing in popularity. As banks and others pile up unwanted real estate holdings they may wish to “unload” their bigger problems in a bulk method such as an auction or portfolio sale. A real estate auction specialist may sell dozens, perhaps even hundreds of properties which cover a broad geographic area. You can find auctions listed in the newspaper or find auction houses in the yellow pages. Just be double sure to do your homework as this is not a short cut to good deals. If you do not have experience or expert guidance you will probably have some expensive lessons in this arena. There are many very sophisticated and financially capable players who play hardball with auction properties.

Foreclosure Servicing Companies. Although banks may sell their “REO” (Real Estate Owned) directly to an investor some will hire companies who specialize in distressed properties to take care of the details and hassles of marketing these properties. You can find them by looking in the local telephone book or by speaking with some Realtors in your area to find out who provides this service in your area. Title companies and Escrow agents usually know of these services as well and may introduce you.

Government and government-backed lender property sales. Government agencies ranging from FHA and VA to HUD including the Department of Justice (i.e. drug related seized homes) sell real estate, you may find these online as well. Fannie Mae and Freddie Mac also operate information websites. Due diligence is the key to smart investing here but, you may find that in general, Fannie Mae tends to list more main-street real estate values.

Build Wealth in Real Estate by Being Patient and Educated. Although foreclosure properties often sell at a healthy discount, you will often find that these properties have many problems. After all ,the people who lived in them usually go through pretty hard times leading up to losing their property. As a result, many will have neglected the repairs and maintenance. In many cases, they will have also really trashed the property on their way out, tearing up the interior; even taking many appliances and fixtures that will need to be replaced to make these houses habitable. You should also take into account the general trend of foreclosures in the immediate area may have an adverse effect on your ability to rent or re-sell for a profit; also causing the process to take longer. Be sure to check on comparable listings and the most recent sales in the area to see what the trends may be.

The Bottom Line. Look for properties that are going to keep their current value and which have the best chance to increase in value. If you buy nice properties in nice neighborhoods this will help you to get the most out of your investment. Location, timing and market trend are still important even if you are buying well below the perceived market value. When it comes time to re-sell you want to be sure you have invested in an appreciating asset which is in demand in your local market place.

If you want access to some more information or analysis

About the Author
Author: Steve Vicory

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In California, Governor Arnold Schwarzenegger made a bold move and announced a deal with four mortgage lenders to freeze adjustable interest rates for some of the state’s highest risk borrowers. These agreements are voluntary and include Countrywide Financial, GMAC Mortgage, Littleton Loan Servicing and HomeEq Servicing. These companies make up the loans for more than 25% of California’s subprime mortgage loans. These frozen rates will be available to homeowners who

1. reside in their property

2. are current in their payments

3. show they cannot afford a payment increase

This deal won’t help the hundreds of homeowners who are already in default or in danger of foreclosure. The following 10 items can help you avoid foreclosure and save your family’s home.

Don’t be in denial about your situation

Don’t ignore letters from your lender

Don’t assume you have no options

Don’t stop making payments

Don’t move out of your home (this could be considered abandonment)

Don’t be afraid to ask for help from loved ones

Don’t be afraid to contact your lender and ask for help

Don’t wait too long to try to sell the home

Don’t be afraid to accept a lower offer than you think it’s worth

Don’t allow your emotions to tie you to this home (it’s just a material thing)

This is a serious issue and you need to remember one very important thing. If you stubbornly hang on to this home out of pride or fear you may damage your credit history and prevent yourself from being able to buy another home. If this happens to you be sure and do something before it’s too late and you lose the home. It’s just a house and you can get another one. You might even be able to get another home sooner than you think, as the prices are at a low point right now.

Explore your options. Be pro-active and contact your lender right away and let them know you want to keep your home. If they don’t hear from you they won’t care about trying to help you. There are options they can help you with such as deed in lieu of foreclosure where you and the bank agree that you give the home back to them. They may even agree to forgive some of the loan. A similar option is a short sale. This is where the mortgage company agrees to settle for less than what you owe them. This can be a way out, but beware that this may have implications down the road and affect your credit when you want to buy your next home.

Late payments can and do affect your credit, but nothing hurts your credit worse than “mortgage lates”. If you possibly can you want to pay your mortgage payments on time and in full. If this becomes impossible for you to do it’s time to do something serious in order to preserve your credit. At some point saving your home may not be the primary concern. Remember, it’s just a house and you can always get another house, but if you damage your credit you may not be able to do that. So make sure you have your priorities in order.

About the Author
Author: Patti Oar

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The president himself has very little direct control over the economy and is not able to affect homeowners unilaterally, besides offering empty statements of hope and accountability for predatory lenders, neither of which represent actual solutions. The Constitution does not give him authority to take money from some people and give it to others in need of mortgage payments, or suspend the collection of private loan payments, or to renegotiate terms of contract that are already in place. Even the Congress is kind of inadequate for many of the same reasons, and others that we have discussed previously, so the foreclosure crisis is our problem as citizens. Therefore, we have to focus on helping homeowners in our own communities as much as possible.

The most important question, then, should be the following: What have you done to help the homeowners on your street avoid losing their homes? If the answer to that question is nothing, then there is no real basis to complain of a lack of government service. Government is often far behind the people, who are the source the most solutions. Also, if community citizens are worried about the foreclosure problem in their neighborhoods, for whatever reason, but do not have any ideas for solutions, then the following list may be useful as a starting point. It is important to remember, though, that the list is just one set of ideas, and it does not take into account local circumstances. The people and the market can come up with a nearly endless supply of solutions, and the government serves to enforce laws and protect homeowners from having their property rights clearly taken advantage of, but does not provide solutions directly.

Maybe a social welfare program in the city/county to help homeowners in distress. If enough people vote for such a measure, it could be paid for by property taxes or a special assessment. Rather than property taxes going to pay for salaries of low-level clerks or to line the pockets of corrupt officials, a fund set aside to provide assistance directly to homeowners may be one of the few wise applications of a tax. However, the free market and citizens themselves can probably do much better and respond quicker to a quickly-changing real estate market.

Donations from local businesses and other private citizens to help local homeowners is possibly the most obvious starting point. One characteristic of the American people is their nearly endless generosity in charitable giving. Often these are donations to provide assistance to churches, the humane society, or people suffering in other countries. But it homeowners on our own streets are currently in danger of being thrown out of their homes, this charitable giving can be directed to our own communities. Citizens themselves may not have much to spare, as they are dealing with their own bills, but local businesses may see such a donation as a great marketing tactic, as well as keeping more wealth in the local community and ensuring they have a larger potential to do business in the future. A large number of foreclosure victims forced to move to another town or county will negatively affect the businesses left behind, as their pool of possible customers shrinks.

Small, local banks offering low rates to local homeowners could be another solution, if the banks have sufficient resources. Rather than watching the central bank of the United States bail out hedge funds and banks, citizens could work with the banks in their local business area. The banks may see this as an opportunity to expand their business and create loyalty with the customers they assist. Obviously, homeowners who simply can not afford their homes any longer would not qualify for a new loan, but ones that can prove stable income and that the temporary hardship is over may be a potential source of ongoing business. Foreclosure victims often learn financial prudence as one consequence of facing the loss of their homes, and they will be grateful to a local bank that allows them a second chance. This may translate into the same family transferring their investments or personal bank accounts to the local bank, as well as sending referral business.

Church charity drives to collect for foreclosure victims is another great idea, as are such simple matters like school bake sales or a concert in the park or local auditorium with local bands with all proceeds go to homeowners. Every little idea can be considered, even if it may not result in a large infusion of cash to the cause of helping homeowners in trouble. But a concerted effort by local families, business, and institutions can take on the problem and solve it through a number of creative methods.

Of course, these local efforts by private citizens will require much harder work in the short term than doing nothing or waiting for an eventual federal government bailout. But the government can only assist some people by hurting others, and forcing people to do what they would otherwise not want to do, while discouraging the more generous from giving more. Through taxing to help homeowners in need, or inflating the money supply by providing a direct bailout with newly-created money, the problem will only be postponed at best, or simply transferred around the country, at worst. Although some communities may be helped, others paying to help those communities would themselves suffer more.

Thus, the possibilities are endless for private citizens and businesses to positively affect the foreclosure crisis in their cities and counties. It also allows them to come together, help homeowners in need, and preserve the property values and spirit of the community. No other method of foreclosure assistance will result in such a potentially positive experience and create stronger local bonds between the homeowners and the local businesses through the charitable spirit of Americans.

Obviously, no one person or effort will be able to affect all of the homeowners in the country, but private citizens can effectively help the smaller number in their communities that are suffering right now. Then, other communities can learn from what is happening around the country, and create their own local solutions. This is not to say that it is wrong to place so little trust in the government to fix the foreclosure crisis, but is meant to emphasize the creativity and charity that are only present in private citizens and the market, who are able to design truly effective methods of providing compassionate assistance without the use of force.

The longer we rely on government to solve the problem of record foreclosure numbers throughout the country, the longer the problem will last and the more people will lose their homes. It is in every homeowner’s best interests to do as much as they can to help other foreclosure victims and provide assistance to those in danger of losing their homes.

About the Author
Author: Nick Adama

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Once you have used your foreclosure listing service, go out and research the property, view it and have independent appraisals and inspections done before purchasing. The homes which need the most work are the ones that offer the lowest prices. If you are a new to flipping houses, be careful when assessing the cost to repair the house. Some properties will need only cosmetic changes such as paint and carpeting. Others will require more intensive labor and more expensive materials. It is important to know upfront the costs associated with making the property not only liveable, but sellable.

The next step is to get qualified for a loan from which the funds will be used to acquire the house. If the house needs extensive renovations, you will need an additional source of funding to cover these costs. Diligently research what the repairs will cost and what profit you should realize from performing the work involved. Be realistic not only with your figures, but with the time it takes to complete the job. Anticipate some setbacks, and be prepared to stretch your budget. A house cannot be flipped if you run out of money or time to capitalize on utilizing all your resources, regardless if they are financial or manpower.

Negotiate in good faith with the lender. Be prepared with all funds, paperwork and contingencies. Be confident in your research in the surrounding area, the cost to bring the property to industry standards and all zoning and permit regulations. Be sure to add the cost to sell, these costs may include a realtor commission, signage and costs to advertise.

Flipping houses has become quite popular and lucrative for the handyman who is successful at crunching numbers and creating an environment pleasing to would-be homewoners. The most difficult obstacle is to find the perfect property, and that obstacle can be eliminated by searching Wisconsin foreclosure listings.

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Author: Bob Smith

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First of all, the New York homeowner is awarded time due to state laws. For a home in New York to be foreclosed by a lender, a court order must be rendered. This ¡°buys¡± the homeowner time for several options.

The first option is to attempt to refinance. Many times a homeowner that is not meeting their mortgage commitment doesn¡¯t have a stellar credit history, however, there are lending institutions offering programs that have been developed for this situation. Countrywide Home Loans, for instance, has a subsidiary which now offers different financing options for homeowners who have fallen on hard times and need help keeping their homes and getting back on their feet. This is accomplished in a number of different ways, adjustable rates, interest only for a period of time or even a greater than 30 year life of the loan. These programs allow the homeowner to keep their home at a lower monthly payment and to continue to gain equity. Most importantly, it offers the homeowner time to fix their finances without the added stress of losing their home.

Another option is to place the home on the market. Since real estate is a hot commodity, many homeowners have the availability to sell their home to get out from under the financial commitment to their lenders. The important step here is to make sure the proceeds from the home sale covers the financial commitment still owing to the lender. The homeowner should present the house in its ¡°best light¡±, and attempt to walk away with some of the equity that hopefully has accumulated. If a house is found on a foreclosure listing, even as a preforeclosure, there will be floods of low ball offers. The homeowner may be pressed to entertain these offers, however, needs to be certain that he can walk away from any transaction avoiding the negative mark of foreclosure on his credit report.

The lender¡¯s loss mitigation department may offer or extend to the homeowner any number of additional options. If a homeowner finds their property on a New York foreclosure listing, to act proactively and responsible is the best way to get resolution to the matter.

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Author: Bob Smith

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Buying real estate in Ohio is a great investment no matter how you decide to buy, but when you learn to purchase Ohio foreclosures, you can dramatically improve the amount you stand to profit on future sales! Real estate in this area is going to always be in high demand, which makes for great chances for appreciation values accumulating as they years go on. But buying homes through Ohio foreclosure listings actually allows you to pay below market prices for some incredible properties. These homes are on sale as a result of the previous homeowner’s default on their home mortgage loan. As a means of collecting the outstanding debt owed, the lender will seek to sell the property in question through a public auction or sale, using the proceeds to cover the debt. But since the amount owed in debt is usually far below the actual market value of the property, most Ohio foreclosures end up being undersold for anywhere between 10 and 50% off what they are actually worth!

Best of all, you can find all kinds of opportunities through foreclosure investing. This process is not just limited to houses, you’ll find everything from apartments, condos and even commercial properties available! No matter what you’re looking for in real estate, buying it through Ohio foreclosure listings means finding it for a great price. And best of all, you don’t have to be a real estate expert to learn how! There is a wealth of information available on buying homes through this method, and anyone can learn to find the best listings right in their area. A good place to start is a foreclosure list, which allows you to get a wide range of listings that you can use to find the properties that fit your needs! Get started today locating all kinds of great deals on real estate in Ohio!

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Author: Bob Smith

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In the Pre-Internet time, finding foreclosures could mean buying very expensive lists and having them sent to you via the mail or knowing someone with an “inside scoop”. Now that’s all behind us. Websites like Forclosure.com keep up to date, huge databases of thousands and thousands of foreclosure listings that allow home buyers to search by state, county, city and zip codes to better find what they need in their target areas. Search Engine results provide potential buyers with all the details needed to find foreclosure homes that best suit their criteria, for example: what the price of the home is, how many bathrooms or bedrooms the home has, who must be contacted for information about the home, the address and a photos can be provided sometimes as well.
Like any market, the real estate market has great bargains if you are willing to put in the effort to find them. It’s just a matter of knowing where to look. Foreclosures can present home buyers a way to grab a home at ridiculous prices, many times saving as much as 50% on the price of their home or more. On occasion properties can be purchased for as much as half of their market value. Until recently, the hardest part of purchasing foreclosed homes was finding foreclosures that were available for sale at the time.
Conventional methods of purchasing real estate can serve some purposes, many home buyers, especially first time home buyers, can be best served utilizing the resources of a site like Forclosure.com. Purchasing a home for much less than market value can help home buyers get into the type of home they may not be able to afford otherwise.

Above and beyond the potential savings, home buyers can gain financing advantages that are many times offered by banks or government agencies that have repossessed properties and then need to be sold. Many times, a buyer can finance a purchase with very little money out of their pocket and at a lower or reduced interest rate. When banks foreclose on a property, they call it REO or “Real Estate Owned”. REO homes are at times offered at well below market value. It’s not unheard of for a bank to offer no prepayment penalties, financing with no points and or low loan costs on their REO homes when they finance them themselves.

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Author: J. Brian Keith

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Pros: 1) you’ve got a good possibility of buying the house subject-to the loan from a very motivated seller who just wants out. 2) you don’t need to do any marketing, just read the foreclosure notices (more on this later), pull some comps and do drive-bys. 3) There are several *thousand* foreclosures published each month, in the greater Atlanta area-plenty to choose from.

Cons: 1) You’ve only got about 3 weeks (to beat the courthouse auction) to contact homeowners and get signed contracts, title work, funding, etc. 2) Most pre-fc homeowners are in denial about their situation and/or mad at the world due to all their stress and debt collection calls they get. Soooo, they’re usually not very open or friendly to you and your offer. 3) Most really good deals are redeemed (caught up) by the homeowner, and the foreclosure cancelled, just before the courthouse auction.
Say you decide to jump in and ‘play the PRE-foreclosure game’. We’d recommend you subscribe to the Atlanta Foreclosure Report at www.equisystems.com/default.htm (about $600/yr and we don’t receive any commission for recommending them), and get the monthly list online. Also, consider doing a lot of bold, cut through the clutter mailings to the pre-foreclosures you’re considering, to get their attention and have them call you. Remember, their mailbox and answering machine is filled with debt collection stuff. You need to stand out, and hit them often. You might want to mail a different neon postcard or lumpy mail (trash can, stick of dynamite, handcuffs, etc.) *every few days*, until they’ve grown to like you or are curious enough to call you.

If you choose to skip pre-foreclosure and actually buy foreclosures at the courthouse steps-then you’re dealing with the foreclosing attorney and the lender, not the homeowner. The biggest things to keep in mind is you’re expected to pay all cash by the END of the auction day; you’ll have to run your own title exam in advance; and you’ll probably have to guess what condition of home interior is since homeowner may not have let you inside. Another option is to buy the note/mortgage for cash at a deep discount, direct from the lender, prior to the courthouse auction. You don’t have to deal with the homeowner that way, but you do have to have access to funds, and you will still have to do your own foreclosure after you buy the mortgage.
Best of success & abundance,

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Author: Lou Castillo

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