Investing in foreclosures

[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.

[urbanrealtor]

Hey ZK.
The only part I wanted to comment on at this time is the licensing part.
Until this year, it was illegal for an investor buying a property in NOD or NOT status to use an agent. This was due to a well intentioned but problematic belief that agents would just be taking advantage of distressed sellers.

Technically the law said that the agent needed to carry a certain type of bonding (which did not exist). This year, inevitably (considering the number of nods and nots), their was a court case that largely nullified this. I will ask counsel about it and repost more tomorrow if you like.

The point is a license used to be kind of a dangerous thing when dealing with foreclosures.

[urbanrealtor]

Hey ZK.
The only part I wanted to comment on at this time is the licensing part.
Until this year, it was illegal for an investor buying a property in NOD or NOT status to use an agent. This was due to a well intentioned but problematic belief that agents would just be taking advantage of distressed sellers.

Technically the law said that the agent needed to carry a certain type of bonding (which did not exist). This year, inevitably (considering the number of nods and nots), their was a court case that largely nullified this. I will ask counsel about it and repost more tomorrow if you like.

The point is a license used to be kind of a dangerous thing when dealing with foreclosures.

[urbanrealtor]

Hey ZK.
The only part I wanted to comment on at this time is the licensing part.
Until this year, it was illegal for an investor buying a property in NOD or NOT status to use an agent. This was due to a well intentioned but problematic belief that agents would just be taking advantage of distressed sellers.

Technically the law said that the agent needed to carry a certain type of bonding (which did not exist). This year, inevitably (considering the number of nods and nots), their was a court case that largely nullified this. I will ask counsel about it and repost more tomorrow if you like.

The point is a license used to be kind of a dangerous thing when dealing with foreclosures.

[urbanrealtor]

Hey ZK.
The only part I wanted to comment on at this time is the licensing part.
Until this year, it was illegal for an investor buying a property in NOD or NOT status to use an agent. This was due to a well intentioned but problematic belief that agents would just be taking advantage of distressed sellers.

Technically the law said that the agent needed to carry a certain type of bonding (which did not exist). This year, inevitably (considering the number of nods and nots), their was a court case that largely nullified this. I will ask counsel about it and repost more tomorrow if you like.

The point is a license used to be kind of a dangerous thing when dealing with foreclosures.

[urbanrealtor]

Hey ZK.
The only part I wanted to comment on at this time is the licensing part.
Until this year, it was illegal for an investor buying a property in NOD or NOT status to use an agent. This was due to a well intentioned but problematic belief that agents would just be taking advantage of distressed sellers.

Technically the law said that the agent needed to carry a certain type of bonding (which did not exist). This year, inevitably (considering the number of nods and nots), their was a court case that largely nullified this. I will ask counsel about it and repost more tomorrow if you like.

The point is a license used to be kind of a dangerous thing when dealing with foreclosures.

[zk]

urbanrealtor,

Thanks for the info. It’s a pretty important point for me, so, yes, any further info you could give me would be greatly appreciated.

Thanks again.

[zk]

urbanrealtor,

Thanks for the info. It’s a pretty important point for me, so, yes, any further info you could give me would be greatly appreciated.

Thanks again.

[zk]

urbanrealtor,

Thanks for the info. It’s a pretty important point for me, so, yes, any further info you could give me would be greatly appreciated.

Thanks again.

[zk]

urbanrealtor,

Thanks for the info. It’s a pretty important point for me, so, yes, any further info you could give me would be greatly appreciated.

Thanks again.

[zk]

urbanrealtor,

Thanks for the info. It’s a pretty important point for me, so, yes, any further info you could give me would be greatly appreciated.

Thanks again.

[EconProf]

You seem to have all the ingredients necessary to make a go of it: enough money, right age to launch a second career, willingness to learn the business, and enthusiasm. What you will need, when the real bottom comes, is the internal fortitude to steel yourself against the anti-real estate psychology that will prevail then. If history is any guide, the same mass hysteria causing people to defy all logic and buy wildly overpriced properties at the top will be reversed. You will look around you and see the wreckage of years of price declines, and the ruined personal finances of those who took the plunge and lost, and will have second thoughts. I suggest even some current Piggs who are now confident they will jump in at the bottom will really not do so when the time comes.

[EconProf]

You seem to have all the ingredients necessary to make a go of it: enough money, right age to launch a second career, willingness to learn the business, and enthusiasm. What you will need, when the real bottom comes, is the internal fortitude to steel yourself against the anti-real estate psychology that will prevail then. If history is any guide, the same mass hysteria causing people to defy all logic and buy wildly overpriced properties at the top will be reversed. You will look around you and see the wreckage of years of price declines, and the ruined personal finances of those who took the plunge and lost, and will have second thoughts. I suggest even some current Piggs who are now confident they will jump in at the bottom will really not do so when the time comes.

[EconProf]

You seem to have all the ingredients necessary to make a go of it: enough money, right age to launch a second career, willingness to learn the business, and enthusiasm. What you will need, when the real bottom comes, is the internal fortitude to steel yourself against the anti-real estate psychology that will prevail then. If history is any guide, the same mass hysteria causing people to defy all logic and buy wildly overpriced properties at the top will be reversed. You will look around you and see the wreckage of years of price declines, and the ruined personal finances of those who took the plunge and lost, and will have second thoughts. I suggest even some current Piggs who are now confident they will jump in at the bottom will really not do so when the time comes.

[EconProf]

You seem to have all the ingredients necessary to make a go of it: enough money, right age to launch a second career, willingness to learn the business, and enthusiasm. What you will need, when the real bottom comes, is the internal fortitude to steel yourself against the anti-real estate psychology that will prevail then. If history is any guide, the same mass hysteria causing people to defy all logic and buy wildly overpriced properties at the top will be reversed. You will look around you and see the wreckage of years of price declines, and the ruined personal finances of those who took the plunge and lost, and will have second thoughts. I suggest even some current Piggs who are now confident they will jump in at the bottom will really not do so when the time comes.

[Author]

Posts