And how do you get an investor? Where can you find one? I really want to flip houses but my credit is shot! I know I have the know how to flip except for the fact of an investor/money. Please help! Thank you!!!! There are several things you need to know when buying foreclosures and flipping properties.
First of all you should go to the nearest book store, purchase several books on buying, fixing and flipping properties. There are several that you might be interested in.
You will also want to find out if your state is a non-judicial or judicial foreclosure state. This will assist you in making offers as well as time frames in which you have to work when purchasing a foreclosed property.
Once, or, while you are doing this you should buy one of the TV guru's distressed property programs. These programs will give you some legal forms you might use when writing an offer to purchase a property. You will also find several scripts to use in taking to your potential clients. The also give you tips and a formula on how to figure if you have a property that you can make money from before buying.
If you are without funds to accomplish this business, you will have to find some investors that will assist you. You will have to make a deal with them about a certain percentage of the profits made from the sale of the property. You will have to advertise in your local newspaper for these type individuals to assist you in buying and flipping.
Normally this is 50/50 however it could be more or less depending on how your relationship is with the investor.
Now to purchase a foreclosed property depends on what phase the foreclosure is in.
#1 Pre-foreclose- the owner is still in the home, he has been notified that he is in foreclosure. Now he has to come current or the foreclosure will continue.
You can make an offer to the owner at this point, give him something in his hand to purchase his equity. Now you will also want to see if there is any repairs that need to be done on the property. If there is you need to know the cost of this repair. You will need to know how many months he is behind in his mortgage payments as well as any fees that the lender has incurred in trying to collect the mortgage payment. Now add these together to include what you had to give the homeowner. Also you must include how much you will need to hold the property, I mean making the mortgage, paying the insurance and taxes while you repair the house for sale.
Now find out the balance of the mortgage add this to the above figure. Now you need a method of finding out the current value of the property. All this information will tell you if you have a deal or not.
#2 The other way to purchase a foreclosure is when the property goes to sale. At this point you must have all cash and you must be able to prove that you have whatever the minimum bid is in cash, cashier鈥檚 check or money orders. If you have no proof you will not be allowed to bid.
#3 One last way is after the sale. If no one bid and get the property at the foreclosure sale, you may find out what bank owns the property, write an offer as well as a check as a deposit not to be cashed until the offer has been accepted. You might also inform them as to how and when you plan to come up with the remainder of the sales price. I have know some lenders to accept offers this way before the property is turned over to a real estate broker to sell.
Now you have to determine how you are gonna market yourself to get.
#1 You can purchase a pre-foreclosure list from a list broker (Join the crowd most do this and mail letters to the person that is in foreclosure)
#2 You can advertise in your local paper that you are in the business of purchasing foreclosures.
#3 You can do a direct mail to people in your city stating that you are now in the foreclosure business.
#4 You can do the research at the county recorders office yourself (time consuming and tedious-but workable. You should get enough leads for a least one days work.)
#5 You can select an area of your city that you want to work and target your that area with your energy. You can walk the area pass out flyers that you are now in the business of buying property distressed, divorced and foreclosures as well as probate property.
Pass out these flyers for at least 2-3 months after which you should go to a newsletter of some sort while still explaining that you purchase properties.
After passing out the flyers for 2-3 months you should follow that up with a newsletter to the same area. Check with the post office and inquire about a bulk mailing stamp. This is a more economical way of mailing business matter.
You will want to form a professional team to assist you in your new career field, which should be composed of but not limited to an attorney, cpa, tax preparer, notary public, title rep, real estate agent and others that you feel will make you successful.
They should pass out your business card to their clients that need your services and you should pass out their cards to your clients that need their services
I hope this has been of some use to you, good luck
"FIGHT ON" email me..... (I'm clickable) You might try a hard money lender if you have the right property in front of you. Check out the free evaluation form at
www.totaldebtsolutionsllc.com
They will connect you with a hardmoney lender. Again, you should be buying a property for cheap that appraises much higher. I commend Skip on his answer to your question! Couldn't have said it better myself, except that I would have included seller financing in the process.
Good Job Skip! and good luckto you. |
