| The process of mortgage foreclosure presents three | | | | involves biding against the lender and other competition. |
| good opportunities for investment - Default | | | | The process of auction is a very fast and normally |
| Pre-Foreclosure, Auction/Sale and the REO.Buying | | | | requires payment in cash within 24-48 hours.You could |
| Default/Pre-ForeclosuresThe process of buying | | | | get good to excellent discounts and get a wonderful |
| pre-foreclosures involves a direct interaction with | | | | return on investment in the end. By far the best |
| homeowner and the lender. The objective here is to | | | | investment, if you do not consider the time wasted on |
| make the homeowner win by selling and win yourself | | | | postponed auctions, expensive title searches and risks |
| by buying the property at a discount.The whole deal | | | | of improper research.Buying REO'sThe easiest way to |
| as outlined above could be a great investing | | | | buying foreclosed real estate is buying REO's (real |
| opportunity, but, timing and procedure is everything. | | | | estate owned). An REO is a category of property |
| You could discount the market value on closure | | | | where the lender repossesses the property to cut |
| anywhere up to 35% on an average. If you act in time | | | | losses and wants to dispose it off for cash, since the |
| and structure the deal properly, you may even get | | | | lender is not in the real estate business.The lender is |
| away with a small down payment. The ale | | | | the only lien holder, 90% of the time which means that |
| agreements can also be tailored to your advantage by | | | | the REO will have a clear title (saves a lot of cost and |
| keeping them unique and flexible.The other side could | | | | heart burn). The property can be assumed free of all |
| be that the owner is not available to deal. A lot of | | | | liabilities and repairs since the lender has the major |
| competition is out there looking to cut you down. | | | | interest. The property thus, may be ready for resale |
| Research in the court could be confusing and take up | | | | once it is purchased although the savings may be small |
| valuable time. Negotiations with lien holders are not | | | | (usually 10-15%).Buying foreclosed real estate can be a |
| ruled out.Well, you are out there to make a nice and | | | | profitable business if you do your homework before |
| tidy profit and these small encumbrances would not | | | | you invest and have the right backing of financiers to |
| really hurt.Auction BuyingBuying foreclosed real estate | | | | finance your acquisitions and a good marketing |
| in a court auction could be the most rewarding and the | | | | network to attract buyers. |
| most risky at the same time. The bidding normally | | | | |