Investing in foreclosures

[zk]

I’m planning on investing in foreclosures when the time is right, which in my opinion will be somewhere between 6 months and 6 years from now. Probably 2 or 3 years. I have sort of a plan, but it’s a plan made with very little knowledge of what it’s going to take to invest successfuly. So it’s a plan that’s subject to change. I’d appreciate any suggestions on making and implementing a plan.

Again, all of the below is stuff I just sort of made up, so even the basics could need adjustment.

It seems like specializing in certain areas is a good idea because you’d be totally familiar with what’s happening in the area(s). What are houses selling for, what are the quirks of each sub-area, etc. So throughout the parts of the plan that precede actually investing in foreclosures, I’d try to familiarize myself as much as possible with an area or two. Look at every listing and every sale and then, as the time approaches to actually invest, start visiting properties. I have a broker friend who will email me the daily stuff from any area. As far as visiting the properties, any suggestions on how to go about that would be appreciated. I’m considering getting a re license, which would make that part easy, but more on that later.

The first thing I’ll do is read a couple (or 10 or however many) books on the subject. I’d appreciate any suggestions for what might be good books on the subject.

I figure I’ll start cruising foreclosure forums and pick up as much as I can there. A lot of times there are sticky, complicated problems that are discussed that could help awareness of things that might not be discussed in the books.

At some point, I’ll head down to the county recorder’s office, or whatever it’s called, and start doing whatever it is you do down there. Just for practice. Get a hands-on feel for whatever it is they’re talking about in the books. Also, I’ll check out the auctions on the courthouse steps. I’ve heard that we’re not yet at the stage of the correction where it’ll generally be profitable to buy anything there, but I’ve also heard of some people getting bargains there. In any case, I’d like to be as familiar with that process as possible.

Why not get a RE agent’s license? Well, I was at a Robert Campbell seminar a couple years ago, and Ward Hannigan was there. Apparently, he’s quite the foreclosure guru. He was saying that it can be disadvantageous to have a license. I think he was talking about if you’re going to approach people who’d gotten NODs and try to negotiate something with them where you buy their house and share any profits with them. Which would only apply if people had equity. I don’t know how common people having equity is going to be in this downturn. In any case, I wasn’t planning on investing in foreclosures at that point, and so I kinda didn’t pay attention to that part. If anybody has an opinion on whether or not a RE license would help, I’d appreciate that.

I may then take one of those intensive (and expensive) courses of the type offered by Mr. Hannigan. I’d like to know as much as possible before taking such a course, so I’ll know what questions to ask. It’s like five grand for three days for one of these courses. Right on the face of it, to me that seems like too much to pay. But I don’t know. Any opinions on that would be appreciated.

Now, at some point, I’ve gotta take the plunge. But before I do that, I’m considering working with or for someone to gain hands-on experience. Maybe just being a runner for them down to the recorder’s office. Or running to check out properties. Or both and more. On the condition, of course, that I’m aware of everything they’re doing so that I can learn what’s happening.

Right now, I don’t have a solid plan as to whether to buy and hold and rent or to buy and flip or both. Any comments on that would be appreciated.

That’s the plan I came up with, and, like any good plan it’ll be subject to periodic review and reassessment. Right now it’s subject to wholesale change pending any advice I get or information I learn.

Thanks

[zk]

I forgot to mention the first part of my plan, which is to ask for advice on a website I know where lots of brilliant and insightful people post. It’s one of the forums over on foreclosures.com. If anyone’s interested, I can find the exact web address. (Just kidding. It’s right here at pigginton’s econo almanac for the landed poor.)

[zk]

I forgot to mention the first part of my plan, which is to ask for advice on a website I know where lots of brilliant and insightful people post. It’s one of the forums over on foreclosures.com. If anyone’s interested, I can find the exact web address. (Just kidding. It’s right here at pigginton’s econo almanac for the landed poor.)

[zk]

I forgot to mention the first part of my plan, which is to ask for advice on a website I know where lots of brilliant and insightful people post. It’s one of the forums over on foreclosures.com. If anyone’s interested, I can find the exact web address. (Just kidding. It’s right here at pigginton’s econo almanac for the landed poor.)

[zk]

I forgot to mention the first part of my plan, which is to ask for advice on a website I know where lots of brilliant and insightful people post. It’s one of the forums over on foreclosures.com. If anyone’s interested, I can find the exact web address. (Just kidding. It’s right here at pigginton’s econo almanac for the landed poor.)

[zk]

I forgot to mention the first part of my plan, which is to ask for advice on a website I know where lots of brilliant and insightful people post. It’s one of the forums over on foreclosures.com. If anyone’s interested, I can find the exact web address. (Just kidding. It’s right here at pigginton’s econo almanac for the landed poor.)

[DWCAP]

I prob shouldnt be the first person to respond here, as I am not a guru of investing in any way shape or form. But the question that comes to mind is, WHY? Why do you want to invest in foreclosures? Do you want to flip imediatly and take a profit on a greater fool theory? Do you want to get a nice little rental and do the LL thing. Do you want to be the next Donald Trump? Diversify your extensive portfolio?

These are questions you need to know the answer for long before you start buying foreclosures. They will dictate what and how you buy/sell.

[DWCAP]

I prob shouldnt be the first person to respond here, as I am not a guru of investing in any way shape or form. But the question that comes to mind is, WHY? Why do you want to invest in foreclosures? Do you want to flip imediatly and take a profit on a greater fool theory? Do you want to get a nice little rental and do the LL thing. Do you want to be the next Donald Trump? Diversify your extensive portfolio?

These are questions you need to know the answer for long before you start buying foreclosures. They will dictate what and how you buy/sell.

[DWCAP]

I prob shouldnt be the first person to respond here, as I am not a guru of investing in any way shape or form. But the question that comes to mind is, WHY? Why do you want to invest in foreclosures? Do you want to flip imediatly and take a profit on a greater fool theory? Do you want to get a nice little rental and do the LL thing. Do you want to be the next Donald Trump? Diversify your extensive portfolio?

These are questions you need to know the answer for long before you start buying foreclosures. They will dictate what and how you buy/sell.

[DWCAP]

I prob shouldnt be the first person to respond here, as I am not a guru of investing in any way shape or form. But the question that comes to mind is, WHY? Why do you want to invest in foreclosures? Do you want to flip imediatly and take a profit on a greater fool theory? Do you want to get a nice little rental and do the LL thing. Do you want to be the next Donald Trump? Diversify your extensive portfolio?

These are questions you need to know the answer for long before you start buying foreclosures. They will dictate what and how you buy/sell.

[DWCAP]

I prob shouldnt be the first person to respond here, as I am not a guru of investing in any way shape or form. But the question that comes to mind is, WHY? Why do you want to invest in foreclosures? Do you want to flip imediatly and take a profit on a greater fool theory? Do you want to get a nice little rental and do the LL thing. Do you want to be the next Donald Trump? Diversify your extensive portfolio?

These are questions you need to know the answer for long before you start buying foreclosures. They will dictate what and how you buy/sell.

[zk]

DWCAP, I’m not expecting any gurus to show me the light. Just a tidbit of info or advice here or there would be great.

Why? To make money. As I said, I don’t think there’s any money in it right now. But I think there will be a few years from now. And I want to be ready when that happens.

At some point the market will turn around and prices will start going up again. The only question is when. I don’t think they’ll go up any time soon, and I don’t think they’ll go up fast for another seven or eight years at the very least. Maybe not for 15 years. But they’ll go up. And if I can get in at or near the bottom by buying houses that banks are giving a discount on in order to unload them, then I should be in good shape. If I can get a few that are cash-flow positive, then I can hold on to them indefinitely as rentals. Either or both of those would be fine. As I said in my original post, I don’t know yet whether my plan will be rentals or flips or both.

As far as the greater fool theory, that only applies if houses are fundamentally overpriced. Which they still are. But which they may not be within a few years. If some confluence of events prevents houses from becoming sensible investments, I won’t do it. But I think it will become profitable at some point in the next few years.

I’m 47 years old, and I’m eligible to retire from my job right now with a 70k pension. But I have a daughter who will be in college in 11 years, and I plan on living another 30 or so, so that isn’t enough. I’m renting right now and have high six figures to invest. I figure that if I put that into residential real estate when it’s more sensible than it is right now, I should be able to have a comfortable retirement and be protected from inflation.

That’s my plan, anyway. All input, contrary and otherwise, is appreciated. I’d like to see it from all angles before I start plunking down money.

[zk]

DWCAP, I’m not expecting any gurus to show me the light. Just a tidbit of info or advice here or there would be great.

Why? To make money. As I said, I don’t think there’s any money in it right now. But I think there will be a few years from now. And I want to be ready when that happens.

At some point the market will turn around and prices will start going up again. The only question is when. I don’t think they’ll go up any time soon, and I don’t think they’ll go up fast for another seven or eight years at the very least. Maybe not for 15 years. But they’ll go up. And if I can get in at or near the bottom by buying houses that banks are giving a discount on in order to unload them, then I should be in good shape. If I can get a few that are cash-flow positive, then I can hold on to them indefinitely as rentals. Either or both of those would be fine. As I said in my original post, I don’t know yet whether my plan will be rentals or flips or both.

As far as the greater fool theory, that only applies if houses are fundamentally overpriced. Which they still are. But which they may not be within a few years. If some confluence of events prevents houses from becoming sensible investments, I won’t do it. But I think it will become profitable at some point in the next few years.

I’m 47 years old, and I’m eligible to retire from my job right now with a 70k pension. But I have a daughter who will be in college in 11 years, and I plan on living another 30 or so, so that isn’t enough. I’m renting right now and have high six figures to invest. I figure that if I put that into residential real estate when it’s more sensible than it is right now, I should be able to have a comfortable retirement and be protected from inflation.

That’s my plan, anyway. All input, contrary and otherwise, is appreciated. I’d like to see it from all angles before I start plunking down money.

[zk]

DWCAP, I’m not expecting any gurus to show me the light. Just a tidbit of info or advice here or there would be great.

Why? To make money. As I said, I don’t think there’s any money in it right now. But I think there will be a few years from now. And I want to be ready when that happens.

At some point the market will turn around and prices will start going up again. The only question is when. I don’t think they’ll go up any time soon, and I don’t think they’ll go up fast for another seven or eight years at the very least. Maybe not for 15 years. But they’ll go up. And if I can get in at or near the bottom by buying houses that banks are giving a discount on in order to unload them, then I should be in good shape. If I can get a few that are cash-flow positive, then I can hold on to them indefinitely as rentals. Either or both of those would be fine. As I said in my original post, I don’t know yet whether my plan will be rentals or flips or both.

As far as the greater fool theory, that only applies if houses are fundamentally overpriced. Which they still are. But which they may not be within a few years. If some confluence of events prevents houses from becoming sensible investments, I won’t do it. But I think it will become profitable at some point in the next few years.

I’m 47 years old, and I’m eligible to retire from my job right now with a 70k pension. But I have a daughter who will be in college in 11 years, and I plan on living another 30 or so, so that isn’t enough. I’m renting right now and have high six figures to invest. I figure that if I put that into residential real estate when it’s more sensible than it is right now, I should be able to have a comfortable retirement and be protected from inflation.

That’s my plan, anyway. All input, contrary and otherwise, is appreciated. I’d like to see it from all angles before I start plunking down money.

[zk]

DWCAP, I’m not expecting any gurus to show me the light. Just a tidbit of info or advice here or there would be great.

Why? To make money. As I said, I don’t think there’s any money in it right now. But I think there will be a few years from now. And I want to be ready when that happens.

At some point the market will turn around and prices will start going up again. The only question is when. I don’t think they’ll go up any time soon, and I don’t think they’ll go up fast for another seven or eight years at the very least. Maybe not for 15 years. But they’ll go up. And if I can get in at or near the bottom by buying houses that banks are giving a discount on in order to unload them, then I should be in good shape. If I can get a few that are cash-flow positive, then I can hold on to them indefinitely as rentals. Either or both of those would be fine. As I said in my original post, I don’t know yet whether my plan will be rentals or flips or both.

As far as the greater fool theory, that only applies if houses are fundamentally overpriced. Which they still are. But which they may not be within a few years. If some confluence of events prevents houses from becoming sensible investments, I won’t do it. But I think it will become profitable at some point in the next few years.

I’m 47 years old, and I’m eligible to retire from my job right now with a 70k pension. But I have a daughter who will be in college in 11 years, and I plan on living another 30 or so, so that isn’t enough. I’m renting right now and have high six figures to invest. I figure that if I put that into residential real estate when it’s more sensible than it is right now, I should be able to have a comfortable retirement and be protected from inflation.

That’s my plan, anyway. All input, contrary and otherwise, is appreciated. I’d like to see it from all angles before I start plunking down money.

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