Doing Deals in Your Bathrobe (Part 2)
Part 1 of this article (from www.foreclose.com) showed how you could find out all sorts of information about a foreclosure property. The article described how you could use the property address obtained from foreclosure.com to get online access to physical and financial details about the property. It also described how you could use the details to help you determine whether the property is potentially a good deal. This article (part 2) shows you how the online research can be applied to a sample property, and how you can use the web to market the property for resale.
Let’s say that you use your foreclosure.com subscription to search for a pre-foreclosure property in your neighborhood. Let’s also say that you obtained the address 1234 Main Street, along with the contact information for the foreclosing attorney and the lender. You could then use a personnel directory site and do a reverse address search to find the owner’s name, for example John Doe. You could also use the address at your local government site to find the property description (e.g., single family, 3BR, 2.5BA, 2000 sq ft), tax assessment (e.g., $205,000), and perhaps even sales history (e.g., sold to John Doe 7 years ago for $140, 000). Furthermore, if your local government enabled online access to the land records, you could do a quick title search to find the original loan balance along with payment terms and conditions. Of course, you would contact the attorney to verify the current balance and whether the sale is still scheduled, but the attorney may not provide the additional property details.
Obviously, some local governments have a more comprehensive web presence than others, and some may offer more property details than others. However, you will still save lots of time and effort by minimizing the time that would otherwise be required to chase down the details by more conventional means.
Now that you have completed your online research for the example, you will be able to do some quick analysis to determine whether this property is a good deal. Let’s say that the original balance was $126K (assuming a 10% down payment), and that after approximately 7 years of payments, the loan was paid down to $100K. Let’s also say that the arrears are 6K, which brings the total outstanding balance to $106K. Finally, let’s say that the market value is $212K. The loan to value is therefore 50%, which makes this a very good deal.
Now that you’ve completed a quick analysis, and determined that this could be a profitable deal for you, you would then contact John Doe and arrange a meeting. Naturally, you’ll need to change out of your bathrobe to attend this meeting. Assuming he is interested, you would negotiate an offer to establish a nice profit for yourself and some moving and rental expenses for John Doe.
Obviously, this is a simplified version of the deal that covers the basic steps. For more insight into the step-by-step techniques for identifying, researching, and negotiating deals, see the book "How to Make $10,000, $20,000 or More Every Time You Buy Real Estate Foreclosure Properties". The book presents a systematic approach for buying foreclosure properties, and is available from foreclosure.com.
Now that you have closed a deal with John Doe to buy his foreclosure property, you are now ready to market the property for a quick profit. You basically have three approaches to flipping this deal. You can flip the contract through an assignment. You can flip the property in “as is” condition as a fixer-upper. Or you can rehab the property and flip it as a property in “move-in” condition. Either way, you can market the property in the online classified section of the local newspaper, a FSBO web site, or the web site of a local realtor.
Virtually all newspapers have an online presence, which will allow you to submit your classified ad online, or by email, for a reasonable cost. The newspapers provide rate and submission guidelines so you can determine the size of the ad and the length of time it will display online. You should also be able to place your ad in the print version for an additional fee.
The FSBO sites will list your property along with marketing details for a small fee. Visitors to these sites will be able to view your online property listing and contact you to start the negotiation process. There are several such sites, so you’ll have to check them out to see which one meets your needs.
Realtors will not only list your property on their sites, but they will also list it in the Multiple Listing Service. The MLS makes your property available to all realtors, and increases the visibility of your property. You will have to contact one of the local realtors to start this process.
As you can see, parts 1 and 2 of this article highlight how you can not only use the web to pursue deals, but how you can also use it to market deals for profit. So now that you know about these online resources, you should start taking advantage of them to help you buy and sell foreclosure properties. There are clearly several steps you can accomplish online from home while in your bathrobe. Obviously, the intent is not to turn you into a hermit who never leaves home, but to show you how you could be much more productive as a foreclosure investor. You should recognize that the more investment steps you can do online, the less time you’ll actually need to pursue a particular deal.
Again, don’t let the fact that you have limited time available prevent you from getting started or from making progress. You have a lot of power in your fingertips, so use them to conduct some of your investment activities while in your bathrobe. So check out the online resources and jump start your foreclosure investment business. You can start at www.foreclose.com. By the way, don’t forget the fuzzy slippers.