Investing in real estate during a bankruptcy.

7 Replies

I am interested to know has anyone started investing in real estate during a bankruptcy?  Is this possible.  Looking for advice.

It's very possible but not for someone new.   I market to this group, but several things to remember.  It's very time consuming, expensive and complicated.  You will never get a wholesale deal from someone currently in bankruptcy because the BK Trustee will insist that any sale be at a minimum of 90% of a BPO.  The only purpose of the Trustee is to see that as many creditors are paid as possible.  They have no interest in you getting a good deal. You will have to learn the federal PACER system www.pacer.gov which charges $0.10 per page to view the file documents.  Trust me, this can add up very fast if you don't learn specifically what to look for.  My first quarter billing was over $2,000.  Now it's about $500.  The only way to succeed is to market to people who have either had their BK case dismissed by the court (usually for failure to file documents timely) or if a lender files a Motion For Relief From Stay (because plan payments are not being made) AND the court grants that motion.  Just filing the motion doesn't count.  If either of these two happen the court is no longer involved, at least with the house.  You can now market to them like a classic wholesale purchase.

Thanks, Robert!  For that information.  For a newbie like me, I will stay away from those types of deals.

Investing money while trying to get out of bankruptcy seems like the exact right thing to do,  I think that Dave Ramsey guys recommends highly leveraged simultaneous Helocs, credit card advances, and hard money bridge loans while defaulting on your old creditors but only if you have over 150k of student debt.

Thanks, Steve!  This is very good information to know.  I love Dave Ramsey's books.  I need to re-read some of his books.

Vanessa Jones you can do anything you put your mind too. But at the same time must be realistic. Concentrate on bettering your personal finances. Master this by taking financial peace university by Dave Ramsey and get IN control of your money. Once you have done this, you should have the financial base to begin figuring out investing. This is going to take a while, so be/stay committed. This isn't about fixing your credit score, it's about learning how to budget, live on less, and being in control. When you have these traits, your success rate for investing will be huge because you will learn how to put deals together with the mindset of being frugal and in control of the money you have or can borrow. It's an art, not a science by the way. Only you can determine how far you will go. Just my two sense. Good luck.

Christopher,

I do appreciate your comment and going to look into Dave Ramsey FPU.  This really helps.

Thanks

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