gregorygarver.com

enoriverbend · Joined: 17 Apr 2004 Posts: 6

of common people buy houses at market's price, I mean looking in yahoo real estate site there's information about it which takes you directly into realty trac and prices are so low that I was wondering if this is not only a scam because I am one of those common people with a common mortage and my realtor never told me about this "great opportunities" and if this is real I would love to invest in one of this "jewels". Could anyone give me a good advice or tell me your experience doing this kind of "business" Thank you!

asian_chicka6949 · Joined: 13 Aug 2007 Posts: 5

Foreclosures are just houses the bank/mortgage lender wants to dump quickly because typically the mortgage holder has gone into default. They can be good deals, but more often than not there are underlying "negative" aspects to the situation that caused the foreclosure. Many foreclosures are in poorer neighborhoods, or even neighbourhoods that have declined so much the owner just quits paying the mortgage as a way to escape the contract rather than trying to sell at a loss.You need all the details on each specific case to make an intelligent decision. And your realtor wouldn't tell you about foreclosures because your realtor wants to sell you as much house as he/she can and have both parties come away happy. Since a foreclosure begins with at least one very unhappy party (the owner, or the bank, or both!) a realtor is smart to avoid that kind of risk!

Cheyenne · Joined: 06 Feb 2006 Posts: 3

Think of it this way. If the property is being foreclosed it is because they couldn't pay the property taxes or the mortgage - probably both. If they can't do that, what do you think the chances are that they kept the property in good repair?Foreclosures can work, especially if you have the skills to fix the property up. That way, you are saving on a lot of labor costs. If you do not have those skills, please think very carefully before you dive in.I have no direct experience of this, but I have never forgotten advice my dad gave me about making money:"If it sounds too good to be true, it probably is."

Magz · Joined: 01 Jun 2006 Posts: 4

Most of the time when a house goes into foreclosure, the people owe more than 80% of it's value. This means the bank has a lot of money it needs to get out of the sale. The reality is, foreclosed homes usually sell for about the same price as other homes in the same condition. Usually they are not taken care of very well and they have been sitting for at least 6 months with no heat. This means lots of them are in rough shape which makes them look cheap. Some people make money by fixing them up and selling them. Really, they are making the money from their carpenter work, not from the real estate.Think about it this way, you are not the first person to get this idea. I mean they are screaming it on TV all the time. If lots of people try to buy something, the price goes up.

CharlieD6622 · Joined: 17 Jan 2007 Posts: 6

There are some problems with foreclosures that most people don't want to hassle with. The fact that they are sold at auction on the court house steps is one deterrent. You have to have the money then and there is another.But, you are also buying blindly. There are no showings, inspections, etc. Like any investment, you are taking your chances.The "jewels" are really few and far between, there is more money made selling "lists" and "secrets" then in actually real state transactions.If you want to dive in hire yourself a REALLY GOOD broker that knows what he is doing. Ask him how many he has done, you want someone with at least a dozen under his/her belt. You will have to pay them, unlike other transactions, there is no commission involved. You will attend the auction with them, but let them do all of the talking. There is a lot of jargon and it all happens REALLY FAST, I am talking seconds here. It is over before the inexperianced folks have any clue what just happened.Also, most foreclosed homes are in the lower end of the income scale. These are not homes you would want to personally reside in, but to purchase as rental properties. Most people are able to get their foreclosure resolved, by selling or otherwise, before it actually occurs.Word of warning.....there are lots of sharks in real estate....and these are heavily infested waters.

FirstTimeBuyer · Joined: 25 Jul 2005 Posts: 3

Buying a foreclosure is somewhat risky. First, your Realtor wont tell you about them because they dont make anything on the transaction. Second it may not be in an area where you wan to live. Third, you really need to know what you are doing and have finances to close and then upgrade.When the market is slim the houses or properties tend to be less desirable however, in todays market there are very attractive opportunities. You need to research the market and know the area. Examine all your up front costs and be prepared to sink some money into the property. Most foreclosures are not well maintained.Research, research, research. Know the property and its short comings. Understand you upside and downside.Good luck

raringvt · Joined: 08 Mar 2004 Posts: 2

The biggest reason why the average person does not buy foreclosures is money. You have to have all-cash, not a mortgage. Then on top of that, the property condition is unknown until you already own it, so you need more cash to fix it up, etc.You really have to know what you are doing to invest in foreclosures. Try taking a class on foreclosures at a local real estate school if you are serious about investing.

QuestionableAnswers · Joined: 19 Sep 2006 Posts: 5

Most of the above answers are very good and I will just add a bit more from my perspective. Every good investment idea has its moments which are constantly on the move. What works well one year may not work at all the next. This is due to the market changing rapidly by a multitude of factors. For example a course might advertize cash at closing but their example was from a deal where sellers were extremely desperate. Speculators flood that area and the market times shorten. Real estate agents see a shortened average market time and proclaim it a sellers market. Sellers become less desperate, your cash back at closing, for less than market price offer, gets ripped up. What some sellers are led to beleive by others, regardless of compelling evidence to the contrary, is often what determines the view that seller will have regarding your offer. Most will lose at that game eventually but generally only a seasoned investor can know where to navigate the course of negotiations. This leads to the next situation which is that of too much investor activity in the pre-foreclosures. Investor newbies by the droves invade the situation and usually ruin theirs and others chances to really solve a sellers problems. Eventually most sellers end up losing the home and it becomes a foreclosed home. It is at times a better opportunity as junior liens are erased that would have ruined the margin in a preforeclosure deal. There are ways to have bought the same home for a great deal using a short sale but thats beyond the scope of your question. Now you see the home on a website like RealtyTrac and it looks like the price is more palatable. It often is softer than the auction price would have been and now doesnt have that all cash now feature. You can do well at this point as you have time for financing and an inspection. A big plus now is that you dont have to buy blindly as the home will be reflective of a major emotional time in the previous owners life. Walls can be bashed in, appliances gone, all sorts of anger caused issues. The real estate investment market has had some very lucrative times and is now saturated with speculators. It is a tough place where you can make a nice profit one day, and be ruined the next if not careful. No course can teach you everything and many real estate agents will buy up those sweet deals to be found and resell them to you later.

feeona · Joined: 14 Dec 2004 Posts: 4

Thye answer is that there are risks involved in purchasing pre and post foreclosures that usually don't exist with turn key retail property. One of the risk is even price! There are some foreclosures in my market area that are priced higher than the comps.Also, most retail buyers want to walk into a clean nice looking home. The average retail buyer would puke if they came across the things I have seen.One thing to note, the prices that you see on Realty Trac are not the selling price. They are either the default amount or the credit bid. Regards