Things to watch out for when buying a foreclosed home

To many people want to run and buy foreclosures before they know what they are doing. Buying foreclosures can be a way to make money and it could be a way to lose your life savings, so be careful before buying foreclosed homes. This article will give you some legitimate ways to find foreclosed homes and what to watch out for.

First consider many things here and please understand the differences. Short Sales are usually homes in foreclosure, but not foreclosed homes. You can buy a short sale, but at slightly less than market price. There is no way for an investor to make money buying short sales, as they must appraise. The banks will not sell the home for less than what they could get elsewhere. They will choose to let the home foreclose and place it back on the market theirself.

A foreclosed home is one where the owner has already lost the home and it is being auctioned on the court steps or available through many sources. A foreclosed home may still have the owner inside the home and you may have to evict the owner. A foreclosed home is not open for inspection, so the most you get to see if by a drive-by. Now, if you are buying a bank foreclosed home, they have already evicted the tenant and have raised the price to accommodate cost involved in the transaction.

The best buy is on the steps of the courthouse, but you must take the responsibility for the repairs, evicting the tenants and even paying off the 2nd and 3rd mortgage. So it is necessary to hire an attorney to protect yourself. When purchasing a foreclosure on the steps of the courthouse, you need to have a fairly large down payment ready to give them on the spot and your financing already set up.
The funds must be in the form of a cashier's check. If the second is owed money, they will be on the steps also and you must agree to pay them, so purchasing a foreclosure is not all that easy. You need to have searched the title prior to the sale to look for all liens to protect yourself.

Where can you purchase foreclosures:

1. Contact a reputable Broker. Especially in todays market, there are tons of Brokers or Realtors working foreclosed properties. They will have a list of all available foreclosures and can help you protect your savings and yourself.

2. HUD homes for sale. You must go through a Broker to buy a HUD home, but you can search the listings yourself. You cannot bid yourself. You must be represented. HUD homes generally go on the high end, but have low down payments and quick financing.

http://www.hud.gov/homes/homesforsale.cfm

3. You can contact any Bank and ask to speak to the REO department. This is also called the loss mitigation department in some banks. Ask for a list of properties for sale and they will help you. They may want the loan with their bank, but that is no problem if you are qualified.

4. You can contact the US Marshall's Office. These homes were taken because of drugs, firearms or alcohol and they have a list available for sale. 

http://www.usdoj.gov/marshals/assets/nsl.htm

5. You can contact the VA. They have many homes for sale and some homes for as little as $1 down if you qualify.

http://www.homesales.gov/homesales/mainAction.do

6. The IRS has foreclosures also. These homes have been repossessed due to tax liens. You can get a list of properties from them also.

http://www.treas.gov/auctions/irs/cat_Real7.htm

As you can see, there are many safe places to buy foreclosures. If you are a learned investor and know how to do the foreclosed property route on the court steps, then those are your best buys, but if not, try some of these links to protect yourself.

How Realtors Can Take Advantage of the Current Housing Market

A Realtor's job is to build a client list and through that client list, work referrals and do what is necessary to survive. Looking for potential clients such as open house, floor duty and cold calling. There is a large amount of ways to work in a foreclosure market, you just have to look. How a Realtor can take advantage of a declining foreclosure market by being aware of the new situations and adapting towards change.

I became a Realtor 22 years ago and during that time the market was in crisis. Home prices were dropping like crazy and Realtors were resigning their positions and choosing to go work for a salary. Not me, I started in a bad year, but I survived. How can a Realtor take advantage of the current housing market? By leaps and bounds and lots of hard work. Any good Realtor can survive any type situation and at any time of the year.

Ethics are the keys:

Ethics and good old know how will get you through this crisis. No matter how poor I ever was, I never ever took advantage of anyone. I had many couples come to me after they just had a bad fight and want to sell their home, I refused. I would send them home to cool off and tell them to come back in a week to talk. Not one of them returned. I cut cost and commissions to help people during these times and they remembered me big time.

I remember one woman who flat out lied to me about her situation and I cut my commission to help her buy a huge home. She was a dentist and she repaired every single tooth I ever needed having fixed. She referred three clients to me and she was my new best friend. How can you take advantage of the housing situation, never act poor. Never beg, borrow or steal and never loose your ethics.

Invest where needed:

As many people are desperate to sell their homes, they will come to you and ask you to find a buyer. If you see a fabulous deal and you have the funds invest. BUT, first disclose to the seller what your position is and tell them that you are buying the property under market value. Many sellers will want to sell quickly and will agree. Note on the sales agreement that you have disclosed your fiduciary duty to the seller.

This is a time to become a millionaire investor. It is a time, not to take advantage of anyone, but to help those who need helping. There is nothing wrong in investing in foreclosed properties for yourself. What do you mean, you want to stay home and read up on the magazines. Get up and work and work hard and you will succeed.

Hard work, due diligence and ethics will help any agent to succeed. I know, I went from a Southern girl to a owner of the largest independent office in my town. I did it in the worse of conditions and I did it honestly and truthfully. One of the main requirements to get a license is "Honesty and Truthfulness." When you become a Realtor, you testify to this. A Realtor is a member of a board of Realtors not a sales agent.

If you are a member of the Board of Realtors, you can be brought up on charges for acting against ethics and honesty. Realtors have to pay fees every year to belong and they are the cream of the crop, hopefully anyway.

Short Sales and Foreclosures:

It is a time to specialize in short sales and foreclosures. You can send letters out to all families in foreclosure and offer to help them. You can get a list from the title company and they will let you know how to contact them. I went to a seminar once and this guy told me to say simply, "I have someone interested in your home," and sign my name in ink. I received tons of replies and I specialized in short sales. I did take a reduced commission, but a 5% commission of 5 million dollars is a lot better than 6% commission of nothing.

Now is not a time to retire and sit back, it is a time to work longer hours, contact your past clients for referrals, send out letters to foreclosures, cold call on the phone and "walk the walk." Don't sit back and drink coffee, work and work harder. It is possible, I know for sure.