Foreclosure Investing For Dummies. Ralph R. Roberts
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Название: Foreclosure Investing For Dummies

Автор: Ralph R. Roberts

Издательство: John Wiley & Sons Limited

Жанр: Недвижимость

Серия:

isbn: 9781119861003

isbn:

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      Marketing and selling to get top dollar

      Your goal in selling a house is to sell it quickly at a price that’s close to its market value. To accomplish that goal, follow these marketing guidelines:

       Set the price right the first time. Don’t set a super-high price hoping that the fish will bite. Your investment property is likely to linger on the market, during which time holding costs will continue to chip away at your profit. An asking price that’s in line with comparably priced homes is best.

       Get the word out through a successful real estate agent. If you’re thinking of saving money on real estate commissions by selling the house yourself, think again. Homes sell in about half the time and for more money through a real estate agent. What you may save in commissions, you end up losing through holding costs and by having to sell for a lower price.

       Begin marketing as soon as you take possession. Marketing begins as soon as you begin your renovations, especially if you start renovating the exterior first. Neighbors notice and begin to gossip, and word-of-mouth advertising begins to take off.

       Plant a For Sale sign on the front lawn when renovations are nearing completion. A For Sale sign removes all doubt that the house is for sale.

       Stage the house impeccably. Clean and scrub inside and out, mow the lawn, freshen the landscape, remove the clutter, tastefully furnish and decorate the interior, set out fresh bouquets of flowers, and let the buyers stream in.

      For additional tips and strategies to sell your property quickly and for top dollar, check out Chapter 18.

      Cashing out equity by refinancing

      When you purchase a property for less than its market value, you automatically have equity in the property. Renovations that bring the property up to its market value may add more equity, assuming that you don’t overspend.

      You can cash out the equity by refinancing it for more than you paid for it to realize your profit almost immediately. Keep in mind, however, that by refinancing for more than the purchase price, you take on a larger mortgage, and the increased interest chips away at your total profit over time. Refinancing, however, does provide you capital to fuel your next investment or cover the cost of renovations. For more about refinancing to cash out equity, see Chapter 19.

      Profiting in other ways

      Selling and refinancing are two of the quickest and most common ways to realize the profit from foreclosures, but other strategies are available:

       Negotiate a short sale. With a short sale, you persuade lenders to accept less than they’re owed, which increases equity in the property, providing you creative ways to help the distressed homeowners out of their jam. (See Chapter 15.)

       Lease the property to renters other than the previous homeowners. (See Chapter 18.)

       Lease the property back to its previous owners. (See Chapter 19.)

       Sell the property to the homeowners’ family members. (See Chapter 19.)

       Sell your position in the property to another lienholder. If you control the first mortgage, for example, you can sell it at a markup to a construction company that has a lien against the property so that the company can protect its interest in the property; otherwise, it risks losing all the money it’s owed. (See Chapter 19.)

      Getting Up to Speed on the Foreclosure Process

      IN THIS CHAPTER

      

Brushing up on the differences in how foreclosures are handled

      

Investigating the early missed-payment pre-foreclosure period

      

Finding opportunities in the Notice of Default stage

      

Arriving at the foreclosure auction stage

      

Waiting out post-foreclosure, from redemption to eviction

      A common foreclosure myth is that it’s a one-time event. Homeowners miss a mortgage payment or two, and the lender swoops in and scoops up the property. The fact is that foreclosure is typically a long, drawn-out legal process that begins with missed payments, proceeds through some sort of legal system, and often results in homeowners losing their homes.

      An understanding of the foreclosure process reveals the various stages at which you can purchase properties. By knowing what to expect, you can often maximize your opportunities while minimizing costly mistakes.

      

Homeowners find themselves facing foreclosure for any number of reasons, including long-term illness or disability, overspending, substance abuse, divorce, and gambling, to mention only a few. As a real estate investor, you gain nothing by judging people in foreclosure. The best way to approach homeowners in foreclosure is with respect and empathy, offering solutions that enable them to leave the past behind and build a more solid financial future.

      The end result of foreclosure is that the homeowners lose ownership and ultimately lose possession of their property. That’s true no matter where you’re buying foreclosure properties. But different states and counties follow different foreclosure procedures. The two main procedures are

       Foreclosure by trustee sale, also referred to as foreclosure by advertisement

       Foreclosure by judicial sale, also referred to as judicial СКАЧАТЬ