Investing in foreclosure properties is a popular investment strategy in the real estate industry, yet many investors have yet to uncover the benefits of pre-foreclosures as highly profitable investment properties. Read on to gain an adequate understanding of how pre-foreclosures investing works.
What Does Pre-Foreclosure Mean?
Pre-foreclosure is the stage in which a Notice of Default is issued to a house owner who is defaulting on a loan, but before the house is listed to be sold through a pre-foreclosure auction. Although buying a pre-foreclosures as investment properties can require going an extra mile, investors often find that going for pre-foreclosures is well worth the stress and extra effort, as they can usually be bought for way below the market value.
Where to find Pre-Foreclosures to Acquire as Investment Properties
County court office: It is known all over the country that laws and regulations differ from state to state. However, oftentimes Notices of Default are recorded with the local county court. Contacting your local county court office is a good way to begin finding pre-foreclosures to acquire ad investment properties.
Online records: Well, some counties make use of technology more than others. So, some counties are known to provide property databases online. You can visit your county website to check if this service is available.
Legal notices: Are you good at reading newspapers? Then, you’re in luck when it comes to finding pre-foreclosure to use as investment properties. You can do this by searching the legal notice section of the newspaper. This section is known to publish pre-foreclosure listings that will be going up for sale at a foreclosure auction. Here is a good platform for you to find your investment properties by choice, and not by chance.
Real Estate Agents/Firms: Many real estate agents or real estate investment firms have access to as many as possible types of properties than you may imagine. Investment firms in particular like the Investway Group in Plant City can help you narrow down your search to only offer you deals that fits your investment goals and portfolio. Real estate agents and firms can help you find pre-foreclosure listings, schedule an appointment, and acquire the deals on your behalf. Here is the surest way to acquire pre-foreclosures as investment properties. It is also the most guaranteed way of populating your portfolio with investment properties that are cheap and fit your goals.
How to Buy Pre-Foreclosures as Investment properties
Commence your search
One of the trickiest things about pre-foreclosures is finding them for investment purposes. If you’re thinking of searching for pre-foreclosures yourself, then you should be ready to spend a huge amount of time and effort making research. However, you can acquire pre-foreclosures as investment properties without wasting time and efforts with investment firms such as the Investway Group in Plant City, Fl.
Get into Action
Once you have identified a pre-foreclosure property or two of interest, it is time to swing into action, getting to where the property is to find out about the condition. And in this case, you need to sometimes carry with you some professionalism and respect as the owner may still be occupying the property.
Get status updates. When you have found a pre-foreclosure property, ensure you write down the name of the trustee or attorney, which mostly is the title company. This is how you can keep tabs on the property to ensure you stay ahead of the competition.
Understand your numbers. Once you receive the data of the property before you commit into making it one of your investment properties, ensure that you note the outstanding loan balance and liens on the property. This can help you in estimating the price and your break-even. When it comes to investment properties, it is all about making profit right?
Make an offer. If you find the occupant welcoming, you may go ahead and ask for a walkthrough of the property to aid you in accurately estimating the cost of repairs and upgrades. This will surely go a long way in helping you make a profit-oriented bid and offer.
Compose a purchase agreement. Once you and the owner have reached a deal verbally, then you must go ahead and put it into writing. You can work with an attorney at this point or a real estate agent skilled in acquiring pre-foreclosures as investment properties.
Enter escrow and close. Now that you both have signed the purchase agreement, an escrow company will serve as the neutral third party to transfer funds and ownership before closing. Once all contingencies have been fulfilled and lifted, and the closing date has been reached, the property should now be officially yours.