Buying foreclosures in USA

Hi Ricky

it looks like i might be the only one on this forum who has been buying in this market ? No one else replied.

Just to clarify for those who want an explaination, if a person defaults on a mortgage in the USA the banks foreclose on the person and sell the house off at a bargain price.
For everyones interest buying foreclosures for us as “out of town” investors is potentially a Minefield. When homes go to foreclosure there is an auction, if you win you get the home. There is no comeback, so subject too finance or inspection. One of the other danagers is the home might still have debt owing on it such as a 2nd Mortgage which you will inherit. There is a real danger for those who haven’t done their homework or don’t know what they are doing. One very experienced investor i know in the US said she wouldn’t buy at foreclosure as your “swimming with the sharks”
Anyway there are better ways to buy than the Highly competative foreclosure markets.
One is Preforeclosure. This is before the bank foreclose you get the owner to sell at the price they would get if its sold at auction.
This example of mine will explain. I bought a home in Texas. the owner owed 54K to the bank. the bank was going to foreclose on them and not only take their home and give them nothing but also destroy their credit score (very important in the US, it dictates if you get a loan and what interest rate you pay). We were able to come along and offer 55K, so the seller gets $1000 in their pocket to restart. They also keep their credit score in tact. So in some ways i have taken advantage of someone in a bad situation. but in another way i’ve saved them from the treatment the Bank would give them. The seller was happy so thats an indication.
With this home for 55k i spent 13 K on it and now its worth 88K. so there are some great opportunities in this preforeclosure market.
Now before you all go running over to the USA a bit of info about preforeclosures. There are people out there who just target these people to buy their home. When someone is about to be foreclosed they are placed on the Foreclosure “list”. this “list” is publically available. these home owners then get bombarded by letters, and door knockers. So like foreclosures its very competative.
I work with people in the US who have some incredible ways of getting to these home owners before the “list is out” They get the deals before anyone even knows about them !
This is the market to be looking, the pre-preforeclosures.

Hope this helps anyone who was interested.

regards westan

Properties in the USA 15-25% returns- email to join our database [email protected]

Hi Flash

well done, and i agree with your comment about the rehabs.

hey where abouts are you buying ? Don’t need to publize here, but i’d be interested. PM me if you want. I’ll tell you mine if you tell me yours [biggrin]

regards westan

Properties in the USA 15-25% returns- email to join our database [email protected]

Hi Guys

flash, i wanted to add one comment that for Aussies trying to buy below market isn’t that easy. I agreed with your comment before but wanted to clarify. Homes that are listed of sale through R/E agents are listed on the MLS. Its hard to pick up bargains on the MLS. Anyhing thatsa super deal goes really quick.
The way to get good buys is to use locals who know the system. And for us to be patient while they are looking. I’ve been over many time to Texas and even though i know the cities very well i would always use a local to help. Not neccessarily a R/E agent.
Just for the record did you use a local to source your deal ?

Auzzielad
rehad – yes a renovation
HUD- gov housing

With the hurricanes the Hud homes in one city i’m active in were all withdrawn from the market to make them available for New Orleans victims.

Finance is easy for Texas and you can get it from some specialist brokers here or from the US. qlds007 from this forum is one, based in QLD.

regards westan

Properties in the USA 15-25% returns- email to join our database [email protected]

Thats exactly right Rikky

thats just one of the great attractions of buying in the US,

regards westan

Properties in the USA 15-25% returns- email to join our database [email protected]

You can definitely buy below value in both NY state, and the other snow states. have done and will continute to do so and its agreat way of creating instant equity on closure with a cash purchase then a refinance, but you have to be prepared to watch and wait and then put in offers that will find a motivated seller. same principles as in NZ,

But as westan says u have to really get to know and understand local conditions, local people, time of year to buy, i.e. when the other out of town investors are not there. you only develop this with time this does not happen instantaneously for those who claim to have gone over and built their team( whilst this is vital you must work this team i.e. provide them with cash not just phone calls, thats how the US works cash is king,a business relationship over their must involve cash benefit for the US team member end of story), and then you only get competitive advantage in this market with knowledge and thats not just a bunch of research which is done pre market but with knowledge you develop by being active in the market, buying, selling, rehabing, letting mixes of them all.

wise advice flash

when the going gets weird the weird turn pro

From what I have seen over time buying foreclosures and pre-foreclosures with established US teams in Texas has to be the way to go. They do it bigger in Texas.

Hello West wealth of info as normal you are

When you talk about your team in the USA, is this like accountant, solicitor etc,
or
research team
or
group of investors, investing together?

Just trying to catch onto the lingo.

Cheers

I could not agree more. I already have a good team in ther United States and have been working with another team in New Zealand for the past few years. Without a good team it makes it difficult to operate well.

Nigel Kibel

http://www.propertyknowhow.com.au

Australian and New Zealand The United States Property Researcher and education
One Day property investment research workshop just $290 Melb 26 November Buying in the United States and New Zealand

Your right you have to pay cash. There are a number of rules you need to follow depending on the type of foreclosure you are entering into. In many cases you can not inspect the property at least not on the inside. You can certainly made checks as to whether there are any out satnding loans on the property or outstanding taxes. These are risks that can easliy be checked. Hense the importance of having a local team on the ground. If anyone is interested in forclosures we can assist you.

Nigel Kibel

http://www.propertyknowhow.com.au

Australian and New Zealand The United States Property Researcher and education
One Day property investment research workshop just $290 Melb 26 November Buying in the United States and New Zealand