Friday, September 14, 2007

Buying Distressed Properties

Every cloud has a silver lining, and the rise in California home foreclosures in no exception. That's if you're an investor hunting for good deals.

Investing in foreclosures is no low-risk venture. You often need to act quickly, have ready cash to buy, and may need to earmark money for repairs to make properties sellable. Here are some basics on buying distressed homes.

Identify properties: Right now, choices are abundant. One way to locate homes is to register with foreclosure information services, such as http://www.bankowned.la/ . This site is free and properties are updated daily.

Options to buy include:

Short sales: When borrowers can't keep current with mortgage payments, some lenders agree to allow the sale of the property for less than the loan balance. Frequently, you can find such deal through real estate professionals representing troubled homeowners.

Auctions: Auctions typically offer the best buys, but the risk to you is greater. You must research liens against the property and decide on your maximum bid price. You're also required to have cash on hand; remember, you're bidding on homes you haven't inspected, and competition can be stiff.

REO's. These are properties that have been taken back by the bank. These homes are frequently listed in the multiple listing services and can be found on http://www.bankowned.la/ which is the San Fernando Valley's exclusive bank owned REO site.

Related links:
Learn how to buy bank owned homes here in the San Fernando Valley.
Need to learn more about short sales? click here.
Another great article titled, "Don't Expect a Bailout if Your Overpaid" is another example on what you should do incase you have bought a home in the last 12-16 months or are thinking of buying a home short.

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