FAQ: Answers To The Most Asked Questions - Start Here

I think I will put a comment on this post everyday just to let the newbies and regulars alike know that it is here.

Guys....if you have questions or are now here please utilize this page FIRST it will help you in the long run and get you up and running a whole lot faster.

dont mind if i do. My first post in my new field is this: Where do the deeds go from a bank or other lender when they write them of as " bad debt"? The house is still where they built it and the County its in still needs to garner taxes from it, right?

Im not 100% sure that I understand the question but Ill try. When the bank forecloses on the property, they own it. They are on the hook for property taxes.

This is another reason you should always use a title company/do a title search when buying property.

Thanks that helped some. guess i didnt get the jargon right. the bank now owns the property from foreclosure, they write off the existing mortgage as debt. them they try to resell the property under a new mortgage at about the same as the old one. Am i close?

If I'm understanding both of you, the house that is foreclosed on goes back to the bank and is then REO, Real Estate Owned by the bank. They want to get rid of it. Banks don't want to own property. So they hire a realtor to sell it, put it on the market. The buyer is NOT responsible for the back taxes or mortgage or anything. You buy the property using whatever financing you use, and you have your own mortgage on it. The bank is the seller and responsible for title insurance, prorated taxes, etc., whatever a normal seller must cover. The good thing for you as the buyer is that the bank is a most motivated seller, so don't be afraid to offer low or wait for the asking price to drop quickly.

I found a foreclosure property that has been on the market for months and has no listing price. Does that mean I make an offer or can I just pay off the total taxes to purchase this home?

Need to find out who the owner is. Has the bank already taken it back? Then you would need to make an offer to the bank.

Only if the taxing authority (county usually) offers it at a tax sale, might you be able to buy it for back taxes.

What is your opinion on both short sales and foreclosers? Which more profitable? And which is easier to do?

Hi guys,

Im Ira i have found out that in texas the finders fee is illegal. I learned this from one of my Investors. Thanks Sully for your help. I will Post exactly what the investor said to me and you give me your take on what i should do. Now that it is not legal what do you suggest i should do now? This was the way for me to build up my money to start getting into the business a little deeper. Here is what my investor told me and you guys let me know what you think:

You're welcome, Ira. I always enjoy talking about real estate with other investors and look forward to receiving deals from you.

Right now, with prices soft and financing more difficult to get, we're focusing on owner financing, taking over payments subject-to existing loans, short sales from lenders, and master leases with the right to sublet. Anything that will help a seller save their credit and move on with their lives can work for us. Properties that need work are fine, from cosmetic to full rehabs.

We'll still do cash offers, but only at rock bottom prices. Deals that would have been awesome bargains a year ago are now routine, even on the MLS. Frankly, we expect the DFW market to do better than the nation, but prices will probably continue to fall for a while, something most sellers don't know or can't imagine.

For properties to rehab and resell, we prefer the Dallas market. For those we keep, they need to be north of the I-30. We're also interested in multi-family units, the larger the better; location on these is less important.

We will pay reasonable assignment fees at closing if you bring us completed contracts. "Bird-dog" fees are illegal in Texas, but we can talk about how to write offers so you get paid for leads.

Please feel free to call me with whatever you find.

Foreclosures are definitely easier to do. You can make good money on both. I tend to favor REOs.

If you're talking about foreclosures, sheriff's sales, they can get pretty tricky, and let me tell you, there's a lot of unknowns. I've got a looong story. But I love the REOs.

Good point Rina.. I thought the choice was between REOs or pre-foreclosures. I don't recommend anyone starting out actually buy at the sheriff's sale. Attending it can be fun and educational but leave the cashier's checks at home.

mjc0406-

You should listen to the last conference call at http://askdeang.com/ He talks about a new program he is developing called the Instant Equity Exchange. This program is a legal way to get around that law. Basically, what you are doing is invoicing the buyer (investor) that you find for equity. So, if the seller was selling the property for $100,000- you have them sign an agreement with you that gives you rights to sell the property for them. Then you contact your buyer/investor and offer the property for $110,000 and you invoice the seller for the $10,000 in equity that you created.

Does that make sense? That is how you can get around that and still make a "bird-dog" fee. Pretty creative, huh?

very helpful thanks for the advice

You have answered some of my questions

I'm having a capital gains issue. Can I talk/hear about it here?

it makes a lot of sense...thanks...now all i have to do is get it set up.

Does anyone know of any lenders that do not require seasoning.

I am currently looking for houses in Alabama. What website do I go to for foreclosures in that area.
I am looking for a house for myself to relocate with no money down due to my credit money back at the closing and helping someone with a win win situation.
Is this possible with this system?

I have contacted people and they are willing to got through with selling me the property. Which form should i use. I am going to eventually release it to the investor. How much finders fee percentage should i ask for? How do i know the investor won't steal the property from me? How long should i ask the buyer to give me to contact a investor? Please help me with some advice.

There is a group especially for this

http://www.deangraziosi.com/node/3677

hi Moemore my name is Franco Blackburn, and I am from Madison County AL. Where exactly are you looking to relocate to.(Does it happen to be part of the big realignment of BRAC?

Just a thought, why don't banks give in a little more on these foreclosers and short sales (especially short sales) instead of giving us the run around with the best deals for them? I know they are just trying to recoup as much as they can get but lets think about a little here; are we not trying to help by giving more people into housing either it being renting or selling and is that not helping the forecloser problem in our country. And I know that the banks kind of frown on investors reaping benefits from these deals while they are taking a lost but lets just say, they were the ones who gave out those loans we didn't - all we are trying to do is give everyone a WIN, WIN, WIN situation from the deal that we make. Sorry but I needed to vent on this topic a little (just discourage).

Little by little.. some are. There is still a lot of over-priced junk out there. But some deals. As banks have properties on the books longer, the prices will come down.

you can check at foreclosures .com it's pretty good

im in the prossess of looking to buy a 3 plex here in anchorage alaska, its a reo property had a inspection done appresal apprased at current condition 220,000 empty with renters 235,000 has potintail to 269,000 wha the appasel said if i in proved on the prop. my price is 195,000 bank payin half the closing 5800 they also paid for water rehook up and some leaky valves clean place up fixed windows so they would work again , i walked through with inspector it need s agood clean ing painting walls some relfinishing hard wood floor, vinalflooring in one bath ,about 5,000 in fixing at the moment will need new rooof in 5 years
8,000 for that my mortage is 1600 amonth , i talked to some proerties mangemnt companies i should get rent s for the 1bedroom units 750x2 the 2beddroom unit 800 to 1000 depending on the condition of the unit ,my question is is this a solid buy , this is my first deal were closing end of next week may 30th . i think it is but like like some feed back please.
thanks
mike
alaska

I am working on a 12 unit myself. I think it may be a good deal but I need numbers.

Purchase Price?
Interest Rate?
Term? r Type of Money?
Payments?
CAP?
rents?
# Units and type?
etc...

Give a little more info and I can give a better idea of where you are with it

Need a little more info on the expenses ie utilities, taxes, insurance.

At 30% expenses, the cap is 10. Not bad.

Hi all,

I am very, very new to this. I bought Dean's book, and LOVED it, but now the problem I am having is how do I start? I am not sure how you all begin to make some sort of initiative on starting a deal. I am in dyer need of a push to get going in the right direction. I am 22 yrs old and have always been interested in real estate this is why I went and bought Dean's book, but again need help as to where I should start. Hope someone can help me out. I look forward to ANY suggestions to someone that really has NO MONEY at all to get started on his first deal.

Thank you all,

Robbie Keith