Investing OptionsWith so many options shown in real estate comps on ways to invest in real estate, why not invest in foreclosed homes?  The opportunity to make a higher profit from a property that has a lower asking price because it is a foreclosure would be wise correct? Of course it would because after you make the purchase you’ll still have money left over to fix it up. That is why investing in foreclosed properties is such a great way to go.  Many foreclosed homes are sold at a discount of anywhere from 10% to 15%… A smart investor knows where to find the best bargains. Buy low and sell high.

The reason homes go into foreclosure is the homeowner defaults on the mortgage and the bank or the lender repossesses the property. All home foreclosures are sold at public auctions. The highest bidder wins. These properties are discounted because selling the property is the most important thing to these lenders. They do not want to get stuck with the property.

Let me give you an example of how you can make a profit off of a foreclosure.  If the outstanding debt to a lender is $100,000 and the price quoted is $80,000 and the highest bid is $81,000 then the bidder will get the foreclosure for a 20% discount. As you can see it is always going to be less than the market price. This is why investing in foreclosure homes is a smart idea and a sound investment.  I am truly hopeful that this is helpful for you and your investing business.

Categories: Real Estate Comps