Sixteen years ago I began my career as a real estate investor in the often overlooked, and sometimes treacherous waters of the foreclosure auctions (aka Trustee Sales).   The Trustee Sales can be a tremendous place to find continuous below market deals without having to deal with sellers. There is, and will always be foreclosures. So today I want to show you how you can add bidding at the Trustee Sales to your investor tool belt.   The first thing that you need to know about investing at the foreclosure auctions is that it truly is “buyer beware”. Now, don’t Read more…

If I haven’t scared you enough with my previous blog post warnings about buying property at auctions, let me try one more time! Don’t get me wrong, there are excellent deals to be had at auction if you know comprehensively what you are doing and where the traps are likely to be.   Here is a quick review of wallet draining auction pitfalls:   Buying a second mortgage foreclosure and thinking that the foreclosure was on the first mortgage when the property is upside down in equity. Your purchase price won’t clear the first mortgage, which will still have a Read more…

I hope you have taken to heart my cautions and warnings about the perils of being a do-it-yourself first-timer at real estate auctions. I want you to understand that it is because I care about your best interests, and I know that the hazardous potential for mistakes with auctions that will drain your investment wallet!   I follow up with these tenexcellent reasons for using a good bidding service when buying properties at auction:   1)    Many major cities have bidding services that stay in touch with all foreclosures and auctions and are knowledgeable about how to meet all requirements, Read more…

A trustee sale is the sale of a property, by a trustee or an agent of a trustee, who is appointedby the lender to carry out the auction for non payment by the homeowner under the terms of the note and deed of trust. This is the lenders only recourse in order to either get paid through a third party’s successful bid at the trustee sale, or when no one bids the lender getting title to the property so they can liquidate. In short, it is a foreclosure sale.   A trustee sale has a number of important characteristics:   Read more…

Oh, the woe! It seemed so easy, bidding online, perhaps watching the television auctions of properties in a state hundreds of miles away…   Here are five rookie mistakes and some of the real-life consequences that resulted for real buyers”   Not checking the title and lien position prior to bidding. Didn’t know they were bidding on the second lien position and thus still being responsible for the loan/lien in first position.   Not checking if there are any other liens on the property. Didn’t know which lienholder was foreclosing Didn’t know how that affected the the lien in which Read more…

Short sales are sometimes the best deals in the current real estate market. Even though many areas are starting to show signs of real estate recovery there are still plenty of homeowners and banks looking for a way to turn properties quickly. Short sales are often the best answer. However, short sales often come with risks. Avoid these three mistakes to make sure your short sale investment pays off: #1 Jumping in too fast. The biggest mistake investors make is jumping into a short sale situation too quickly.  Do your research, make sure you accurately value the properties “fixed and Read more…

In the real estate world, foreclosures can be a gold mine or a money pit. One way to go about finding one’s that will make you money is to find a pre-foreclosure in your market. Sometimes this is easier said than done. The first place to look for a pre-foreclosure is online. Start doing your research on websites like Zillow.com. Zillow makes it simple to determine which homes are in pre-foreclosure (according to public records) and can help you locate them. Another great way to find them is to use your connections. Talk to your friends in real estate and Read more…

Have you ever wondered what happens to foreclosures that don’t sell at auction? What does the bank do with them? Just hold on to them and lose money? Of course not! The bank is in the business of lending, not holding property. The best way for them to unload their inventory is to sell the property as fast as possible.  These kinds of properties are called bank-owned REOs (REO stands for Real Estate Owned) and they differ from foreclosures in some significant ways. The biggest difference between an REO and a foreclosure is that a foreclosure is being sold to Read more…

When someone says auction you probably think of a big barn with a fast-talking man and people flashing numbers while the man gesticulates wildly. While that portrayal is popular in TV shows and movies, real estate auctions in real life aren’t that way. And if you’re thinking of buying real estate at an auction you need to be prepared. The best place to start is by attending an auction—one you aren’t planning on buying at. Find a realtor/investor who is experienced with the auction process and attend with them. Take notes and ask them lots of questions. Experiencing an auction Read more…

Short sales, loosely defined, are any property that is sold for less than the amount owed on it. Short sales were almost everywhere in the years after the real estate bubble burst and many property owners were underwater. Back then it was difficult to invest in them but as the real estate market has started to recover it’s gotten easier. In fact, short sales are still a great way to make a profit in real estate investing—if you are careful. To invest successfully in a short sale follow these steps: 1)    Learn the rules. Depending on where you live there Read more…