Good afternoon to all, can some one tell me if its a good idea for a newbie who has not done there first deal yet if its a good idea to invest in a foreclosure property. I have been in the business for about 6 months and have really learned a lot by reading. I almost had a deal when I first started but the property had to much of a mold issue. It was going to b a fix and flip. I really want to wholesale so I want to know if its a good idea to wholesale foreclosed properties. Thank you so much for your response. Deurward
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couple things regarding foreclosures
1. the market is really tight for foreclosures. It is almost impossible in my market to find any foreclosure under market value enough that fits our criteria (70% ARV - repairs = MAO). direct mail and bandit signs are really hot in my area simply because foreclosures are being sold about 85% of market value. The majority of investors will run away from 85% market value deals.
2. you can't wholesale foreclosures other than HUD homes. Almost all banks have a line in there contracts that state the contract is non assignable. Now, with that being said you could double close and wholesale it that way. but from what I am gathering you are new to the business and might not have access to cash to necessarily double close. I would find a different avenue than foreclosures to pursue simply because it is getting tighter and will continue to get tighter until you can't find anything worth while on the MLS
thank you so much for the info david, it's much appreciated.
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