Are You Interested In Real Estate Investing
August 9th, 2010 Posted in Short SalesMany men and women are looking at the real estate investing business these days. Many believe that this is the right time to start investing in property because of the abundance of foreclosures available. Foreclosed houses are those owned by the bank or the lender.
The lender takes possession of the property when the borrower cannot make his monthly house payment. The banks then sell the property to those looking for a home to move into, or to real property investors. In most cases investors buy foreclosed properties because people who looking for a home to move into are looking for a house that does not need extensive renovation.
Foreclosed properties are usually in need of rehab. When the people who are losing their home realize that they will have to vacate the premises they allow the home to fall into disrepair. In fact some people take out their financial frustration out on the house and inflict damage on walls, plumbing, or other parts of the property.
Property investors will rehab the home and then place it on the market for sale for a profit or they will rent the house for positive cash flow. People who buy homes that are repossessed by the bank, also called REO properties, or real estate owned, usually work with one or two qualified real estate professionals. Banks do not list their properties with just any agent.
The banks do not work with every agent in the area. They operate with only a select few; those who have experience in listing and selling REO property. The smart investor finds the agents that work with the bank owned property and builds a business relationship. The investor who knows the agents that work with the banks, will find out about recent available foreclosures before they are placed on the MLS, or multiple listing service.
The agent is required to place the foreclosures on the MLS within a certain time frame once he is hired to represent the bank in the property sale. But the agent can inform his investor friends of the property before he lists them. Therefore, the investor will be able to bid on the house before others know it is available.
This is legal and well within the ethical laws of the real estate commission. The more friends who represent REO properties that an investor has, the more bids he will be able to make on land that is not yet placed on the MLS.
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