Investing in Foreclosures

Investing in Foreclosures
There are many ways to get started in the real estate
market. The best one right now for many investors is by
investing in foreclosures. This tactic allows you to buy
quality properties for pennies on the dollar. With the
recent real estate crisis, there are many foreclosures on
the market to choose from.

There are some basic rules you should follow when investing
in foreclosures. The first one is to know what you want.
This is a simple matter of creating a business plan. By
listing what you want to accomplish and how you are going
to do that will help keep things on a more narrow road. You
will not get side tracked by every "good" deal you come
across.

When you are investing in foreclosures you must first
determine what you are going to do with the property. You
need to realize whether you are going to buy it, refurbish
it, and resell it, otherwise known as flipping. Or are you
going to hold on to the property for some time and use it
as a rental. This will determine what types of properties
you will want to look at.

The business plan should include what types of houses or
properties in which you are going to invest. If you are
familiar with commercial real estate, then it would be good
to stick to this type of property. You may want to deal
with single family homes. Again, this is also going to be
determined by what you want to do. Single family and
multi-family homes are great for someone interested in
being a landlord.

Market research is also part of putting together a good
business plan. The market will have a great deal to do
with the types of properties you buy. Just because there
is a fantastic English Tudor for sale at 50% less than
market value, does not mean it is a good investment. The
homes in the neighborhood which are selling may only be
three bedroom ranches.

Cash flow is also an important part of the business plan.
You will want to generate a positive cash flow as soon as
possible. To do this you must be able to generate cash
from either a family member, friend, or the lenders. When
you are investing in real estate, the lenders will be
examining the property values, the market and your credit
risk. A good, solid business plan can sometimes be more
persuasive than just walking in and asking for a loan.

With a business plan there will also be a team you put
together to help when investing in foreclosures. The first
member of your team should be a qualified real estate
agent. This is the person who can tell you the market
trends for the neighborhood. You will also want an
inspector or contractor. This is the one who will let you
know just what kind of repairs you will have to make on any
of the properties you are looking at. You will also want
someone who has experience with investing. This may be a
friend, family member, or even another investor. With a
solid team behind you, investing in foreclosures is not as
hard as some people think.

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Gary Giardina
For More Information on foreclosures,please visit:
http://www.aboutforeclosurelistings.com