Posted by investorrob on April 22, 2003 at 21:54:23:
In foreclosures an investor has to do a lot of court house research. To make it clear One must do this research on any deal. Preforeclosures or just an owner wanting to move. You don’t want to find yourself in the story below.
Lets give an example. You find a great 4 b 2b for $54,000 going to auction. and you have done a drive by noting that other homes are selling for $235,000. Without any other info you buy at the auction and bid $10.00 over the banks bid. A few days later you have info that the First mortgage holder is also holding an auction 2 week away. for $160,000 What you bought was the 2nd mortgage. To save the $54,000 you must win the bid from the First mortgage. Now the deal is very skinny and you become a don’t wanter very fast.
On all deals these days, one must buy right to sell right " you make your money when you buy not when you sell"
Some investors do buy at auction I think its much better with many more options to the investor to buy preforeclosures-- propertys that are up for foreclosure but the auction is a month or more away The owner is still in the house or you know where he can be reached. You make a deal with him and don’t have as much of a bidding war that you might have at the courthouse steps it the property had lots of equity.–I would even buy if the deal was right 1 day away if I have done my research on the property.
It takes guts to walk up to the owner’s door and knock and speak with them but in my view the deals are better.
For your information Joe Kaiser has a very fine course dealing with the subject. You can buy it here on creonline, as as I recall moderately priced as well.
I hope this will help.
The very best of investing to you