I’m new here and want to say that this site has some great info. I’ve made some money flipping but that was when the market was hot. I’m really interested in buying pre foreclosed and foreclosed properties and either flipping them or renting them out.
My question is how firm are the banks when it comes to them getting fair market value? If they are firm what are the advantages of buying fc properties?
The answer to your question is that it depends on a lot of things. How much is owed on the property? How is the market where the house is located? Is there mortgage insurance on the property? etc, etc, etc.
There is no advantage to buying pre-foreclosure or foreclosure properties unless they are the best deal out there. Go by the numbers, not the strategy.
Good Luck,
Mike
Thanks Mike for the reply. What exactly would constitute the best deal?
leggs,
In your original question, you asked what are the advantages of buying fc properties if the bank is firm on getting retail price.
There is no advantage to buying foreclosed properties if you can’t make money with them. Instead of limiting your search for properties to foreclosures, you should be looking for the property that can be bought at the biggest discount. This might be a desperate landlord, a deal from a fellow investor at your REIA, a REO, a property on the MLS, a property you find from placing a small classified ad, etc.
Would it be better to pay $100,000 for a $100,000 fc property or to pay $70,000 for a $100,000 property that is owned by a desperate landlord. I know which one I’d take.
Mike