Exit Strategies When Buying a Pre Foreclosures Part III
You must know what you're going to do with the pre foreclosure real estate after you buy it so you know how much money to spend on the repairs.
Figuring Repair costs before buying a pre foreclosure short sale If you are going to resell the property, you might want to put in granite counter tops (depending on your neighborhood) in the kitchen and bath.
Maybe marble tile on the floors.
You might spend more money on the landscaping for curb appeal to bring people into the house to see how great it is.
If you were going to rent it out and put tenants in the house for the next few years, you probably wouldn't spend that much money on the interior, thinking you might get cigarettes burns in the granite and other irreparable damage throughout the house.
These are all costs that you must figure in upfront, while you are making the offer.
If you decide to fix and resell, but you can't get the bank to discount the purchase price enough for granite counter tops, then maybe you do end up renting.
You can change the plan as you go, because you always have to have a backup exit strategy too! And back up strategies when buying a pre foreclosure can change too.
If you end up not having the money to rehab or buy the house, and you still need to close fast because the bank still accepted your number, what are you going to do? 1.
You could find a rehabber and wholesale it to them.
2.
Find a landlord in that same neighborhood that would hold the property and rent it.
3.
Market on the internet, MLS or bandit signs to find an owner occupant.
So have a list of people who want to rehab properties.
Place ad in the local papers when you have pre foreclosure real estate to sell.
Ask your callers: * What kind of property they want * Where they prefer it to be located * How much cash they have and how quickly they can use it * What kind of rehab they prefer:paint and carpet or foundation work 4.
You can also make flyers and put them in the local paper or pass them out door to door.
5.
Go to your REIA (real estate investors association).
Have other investors sign your buyers list.
Save the name and call them occasionally.
Let them know: o The market is slow - but deals are coming.
o The market is great - we have deals in these areas.
o Just wanted to check in and see if you were still interested in deals in the $??? Range.
You'll find following up on your pre foreclosure real estate list of buyers will be very beneficial when you need money to close! All these things are important in getting a pre foreclosure short sale to close.
Remember too, that you make your money when you BUY the property - meaning you have to buy low.
And when the deal is good because you did buy low, somebody will have the money to lend to you or to buy it from you.
Don't give up.
Be creative on how to find more buyers and sellers! Good luck and success and may all of your pre foreclosure real estate ventures have a positive cash flow!
Figuring Repair costs before buying a pre foreclosure short sale If you are going to resell the property, you might want to put in granite counter tops (depending on your neighborhood) in the kitchen and bath.
Maybe marble tile on the floors.
You might spend more money on the landscaping for curb appeal to bring people into the house to see how great it is.
If you were going to rent it out and put tenants in the house for the next few years, you probably wouldn't spend that much money on the interior, thinking you might get cigarettes burns in the granite and other irreparable damage throughout the house.
These are all costs that you must figure in upfront, while you are making the offer.
If you decide to fix and resell, but you can't get the bank to discount the purchase price enough for granite counter tops, then maybe you do end up renting.
You can change the plan as you go, because you always have to have a backup exit strategy too! And back up strategies when buying a pre foreclosure can change too.
If you end up not having the money to rehab or buy the house, and you still need to close fast because the bank still accepted your number, what are you going to do? 1.
You could find a rehabber and wholesale it to them.
2.
Find a landlord in that same neighborhood that would hold the property and rent it.
3.
Market on the internet, MLS or bandit signs to find an owner occupant.
So have a list of people who want to rehab properties.
Place ad in the local papers when you have pre foreclosure real estate to sell.
Ask your callers: * What kind of property they want * Where they prefer it to be located * How much cash they have and how quickly they can use it * What kind of rehab they prefer:paint and carpet or foundation work 4.
You can also make flyers and put them in the local paper or pass them out door to door.
5.
Go to your REIA (real estate investors association).
Have other investors sign your buyers list.
Save the name and call them occasionally.
Let them know: o The market is slow - but deals are coming.
o The market is great - we have deals in these areas.
o Just wanted to check in and see if you were still interested in deals in the $??? Range.
You'll find following up on your pre foreclosure real estate list of buyers will be very beneficial when you need money to close! All these things are important in getting a pre foreclosure short sale to close.
Remember too, that you make your money when you BUY the property - meaning you have to buy low.
And when the deal is good because you did buy low, somebody will have the money to lend to you or to buy it from you.
Don't give up.
Be creative on how to find more buyers and sellers! Good luck and success and may all of your pre foreclosure real estate ventures have a positive cash flow!
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