Step one is seeking out the deals. What you need to look for is motivation to sell and equity. A great place to start looking is the bank. They have already been taken care of and free and clear.
It is important to target mailers to people who still have equity in their home. These are the individuals to seek out and focus on. With 500,000 people losing their jobs and on the verge of losing their homes, they all in desperate need for cash. The opportunities are endless.
Foreclosure properties right now are a hot commodity because they have many things to offer in comparison to other types of real estate. Even though they may have some built in problems, they are very easy to target. With so much information out there, locating them is simple.
Banks and people both sell their houses in pretty much the same way. The bank just contacts a broker who then lists the property in this computer system which is the MLS that all other agents have access to. Getting your license is highly recommended if only to access the MLS.
When a property is listed several details about it are given. For example, the square footage, the area it is located in, the type of roof, how many bedrooms and bathrooms it has, among other things. After the property is listed, a broker puts out a for sale sign for all to see. As you drive by and notice the sign, you would then contract the broker and view the home. Remember that the broker is representing the bank which is selling the home. They are not currently representing you as the buyer. They have a fiduciary responsibility to the bank because they signed an agreement. If they do invite you to their office and wish to help you, then they officially represent you. At this time they become a dual agency, representing both the seller and the buyer.
Another way to locate a property, besides driving around, is directly contacting the local real estate agencies and telling them you are looking for a good deal. They will probably invite you to come to theirs offices so that you can view some of the listings on the MLS. The agent becomes your representative and proceeds to make an initial offer on your behalf to the seller.
This is where the asset manager comes in. An asset manager is the representative at the bank that the broker is in communication with. This individual is the one who receives the offer and decided on whether or not it is accepted.
Whether you choose to work with a broker or not is up to you. They can offer a lot but hey can also be limiting. If you are searching for REOs and you call the broker directly, they receive 6% instead of 3%. This is one good way of making your offer magically move to the top of the list. If you do contact the broker directly and you hit it off, again, chances are they will pay more consideration to your offer.
You may ask as to why even enlist the services of an agent. The main reason is MLS access. This were all of the foreclosures are listed. Sure, you can find them through other resources, but nothing is as comprehensive as the MLS. You definitely need it.
Jeff Adams is a full time investor who has done over 350 deals and is a leading expert in the buying and selling of real estate. For more information and to receive your free Foreclosure Profits CD, visit FreeForeclosureCourse.com FreeForeclosureCourse.com or sign up for his free seven day e-course at RealEstateWebProfits.com RealEstateWebProfits.com
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