Conclusion : Although, all the steps can be done by the investor not as easy and it is quite time consuming. The process takes a lot of time having to balance - kids, family, full time jobs, and running errands.
Not a particularly good option.
Challenges:
- Researching properties
- Cash to buy the properties
- Competition against other bidders
- Liens, Judgments- typically not totally clean
- Previous Homeowners, Evictions- Evicting tenants/ homeowners.
As it stands today, most foreclosures being sold at the court house are by banks and the minimum price that these banks are willing to accept is the amount of the mortgage loan outstanding. Given where the property values are relative to loan amounts, these prices are not attractive at all.
In addition, investors have to research liens, judgements, evaluate the foundation and condition of the property, estimate the rehab and make an offer that beats competitors. If you happen to win, you'll still need to deal with evictions, destruction of property by distressed homeowners etc.
Again, lots of time and effort and not a particularly good deal.
Conclusion : Not a particularly good option
3.Buying Foreclosures that are Real Estate Owned (REO)
Most REOs are now being listed on the MLS. Again, banks are looking to get close to what is perceived market value. Not a particularly good deal for the opportunistic foreclosure investor.
You have to do your research on all the properties ahead of time so you know what your bidding on. There are a lot of bidders. Many of the properties you think are going to auction do not make it there because the lender agrees to work with owner. A lot of times they are not good deals.
People try to buy directly from the bank themselves
