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4 Success Tips For Building Wealth In Real Estate

1. Find out who offers foreclosure properties in your investment area. Contact each of the following: (a) Banks offering real estate loans. They will usually have foreclosures they want to put in the hands of ambitious people such as yourself; (b) Your County Clerk's office where they usually have foreclosure properties listed for sale, and; (c) Federal Government offices (IRS, FHA, VA) that have foreclosure properties you can acquire at low cost.

Get all the free information from these organizations that you can. They'll be glad to put you on their mailing list, plus they'll supply you with a packet of their current data. Study what you receive - it could give you a quick "college education" in the foreclosure situation in your investment area.

Since there is a wide range of quality of foreclosure properties, you must develop a sense for the good vs. the bad. Do this by visiting a number of foreclosure properties offered to you. Make notes about each. Be completely frank with your notes because they're for only your eyes - no one else's. If a property is in awful condition, make a note of that. If a property is in superb condition, note that also. You'll soon know the good from the bad!

2. Work with foreclosure sellers who will pay all closing costs for you while providing the needed legal counsel free. Banks often offer to pay all your closing costs while having their attorney act as your counsel. You can trust such an offer because the bank does not want the property back. Instead, the bank wants to see you successfully operating the property and making your mortgage payment on time, once a month. If you're nervous about the bank's attorney representing you, hire your own attorney to check the work done by the bank's counsel.

In general, your attorney will approve the bank attorney's work. And the fee your attorney charges you will also be small - say $100 to $300 - because no new original work is being done. Taking over foreclosures from banks can get you started in real estate on almost zero cash.

3. Learn bidding techniques before you make an actual bid for a property. You will have to bid on foreclosures offered at County Clerk sales and Federal Government (IRS, FHA, VA, etc.) sales because their rules require public open bidding. In making a bid you will usually be competing against others who also want to buy the foreclosed property that appeals to you. Since open bidding is based on raising the price of the offered item to the highest level possible, you must be careful not to over-bid by getting caught up in the give and take of the process.

4. Flip your foreclosure properties to make fast money without owning the property too long. You can of course hold onto foreclosures and rent them out. But many times you're better off flipping foreclosures - that is, selling them for the highest price you can get, shortly after you buy the foreclosure. Why is this? Because many foreclosures will require repairs and cosmetic work before they are suitable as rentals.

 

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