A pre-foreclosure occurs in between the time period when the owner of the property defaults his loans and the bank has possession of the property. This is the ideal time for an investor or real estate agent to take advantage of the situation and propose a pre-foreclosure. It creates a win-win situation for both parties involved because the owner can be relieved after handing over the mortgages to the investor and the investor is also happy because he can buy the land at about 20-35% discounted rate of the market value.
The pre-foreclosure time period is the best time to hunt for bargain homes and the best deals. If you are purchasing homes directly from the homeowner, you will most probably be buying a house that has not yet been legally repossessed. During the pre-foreclosure period, homeowners generally have their houses under mortgages. However, they still own they house and have a right to sell them. The pre-foreclosure period is therefore a good time to invest in homes especially because the homeowners are quite eager and motivated to sell the houses.
If you are looking for pre-foreclosure homes that you are interested in purchasing, you must follow a few simple steps to ensure a successful purchase. The most important thing to do is to identify the pre-foreclosure properties. This can be easily done by visiting the county courthouses and looking at the listings. Some companies do this job for you and post the listings online for which you might have to pay a small price. The next step is to evaluate and analyze the listings to find the house that best suits your needs. The gross equity of each pre-foreclosure home must be evaluated because that reflects the gross profit potential of the home. During the pre-foreclosure period it is generally difficult to contact the homeowners, but this must be done so that you can meet the homeowner and inspect the property. Also check the loan, mortgage and insurance documents along with the foreclosure notices.
After inspecting the property, you can determine the market value, repair cost, after repaired value and the potential sale price and profit. You will need to state your offer to the homeowner and try and negotiate as much as possible. Discounts can range anywhere between 20 and 35%. After the property is yours, you should refurbish it and either let it out for rent or prepare to re-sell it. If you are interested in finding out more about pre-foreclosure deals and homes, please visit ForeclosureRepos.com
Select a state in the list below for foreclosure listings of bank foreclosures for sale.