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Foreclosed Homes: Gold Mines Or Mine Fields?

     Real estate foreclosures include various problems from several directions to be sure.  However, as is often the case, where there are obstacles there also are opportunities, and with respect to real estate foreclosures, those opportunities are abundant indeed!  But, are the potential foreclosure profits to be earned from such opportunities gold mines or mine fields?  Well, the answer to that question is clearly, “Both!”

     There are many ways that one can seek to gain from home foreclosures, but they basically derive from the three main time periods associated with any specific foreclosure:

     1) the time period before foreclosure,

     2) the time period from beginning to end of the actual foreclosure process, and 

     3) the time period right after the foreclosure.

     Each period contains good chances for earning high financial jackpots, and enormous calamities.

     During the preforeclosure period, viable property owners should have some equity left in their properties to permit a short sale.  On the benefit side of these opportunities are two complimentary components.  First, the investor who can productively and diligently work his or her way through the procedure during this period can gain big rewards.  Second, having bought the property at a very attractive price and sold it successfully for a quick profit, the property seller can be given some additional cash from the transaction making it a win-win result.

     On the minus side, transactions during this period can take longer than normal property purchases because a bank’s approval is needed before the sale process can even start.  Moreover, working with homeowners who are under all the financial stress and emotional strain involved in such circumstances is very difficult and beyond the capabilities of many investors.

     During the foreclosure process proper, investors can still earn a very significant return on their investment and can do so without the unsettling emotional penalties yielded while engaged with distressed sellers.

     However, while the property will probably have been taken back by the mortgage holder and be up for auction during this period, new difficulties must be subdued to deal effectively and sensibly with the bidding fury common with auctions to ensure that one asserts self control and doesn’t pay too much.

     Last, those homes that don’t sell at auctions return to the lender and may then be sold as REO homes in MLS listings and elsewhere.  Here again, super bargains can be discovered and profits earned, particularly among banks with an surplus of foreclosed homes on their books.  Anytime companies have under performing assets on their books, lenders included, they’re going to be extremely motivated to get out from under them.

     The major downside of investing profitably in foreclosures during this period is arranging payment.  Banks are reticent to lend to prospective speculators of REO properties.  And, with many bankers who are swimming in, if not overwhelmed by losses of this nature, getting more than a 20% discount is very doubtful.

     So, is investing successfully in house foreclosures more mine field than gold mine, more fancy than fact?  Absolutely not!  But it is imperative that one learn what to do, when and where to do it, with whom to do it and not to do it, as well as how to do it.  And knowing why to do something is helpful, too!  My advise?  Learn all this and more from  some trusted source such as “Foreclosure Profit Finder” available from http://www.JuJamVideoReview.com/foreclosureprofitfinder.html!  Check it out for yourself!

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About the Author

          James Nelson has accumulated almost 40 years of successful business experience, and much of it has been based on the maxim, “Do what you do do well, then find others who can do the rest best!”   He is currently President of JuJam Enterprises Incorporated where they focus on “Helping People Help Themselves.”  You can discover more about finding foreclosure profits on their website, http://www.JuJamVideoReview.com/foreclosureprofitfinder.html.  Previously, together with his wife, Judy, he owned and operated Lakewood Lodge, a family recreation resort in northern Minnesota.  Prior to that he completed 23 years in various sales and marketing management positions at AT&T.  He earned a Bachelor of Science (Business) degree from the University of Minnesota with Distinction in 1975.  Before attending college under the GI Bill, he served 10 years in the U.S. Navy.