Starting out in REO's but need help?

Question

I have been reading this board for a few days now and decided to become a member. I am 24 and I have decided to get in to REI. I really want to start with REO's. I have been reading and doing research and my plan is to start getting homes fix and flip to get my feet wet. My queston is I have read a lot of people have said they have purchased property anywhere from 55-100k and that would be my range given i don't have very much money to start with. Is this possible in California and if so, is there a certain procedure to acquire property for that price. Also, what advice would you give to someone in my position on starting with very low investment $$$ and so-so credit. And lastly, is it good to use a INC or LLC to purchase property under? any help is greatly, greatly appreciated! :D

Joshua D. · Answer

On the left toolbar, you'll see a section about foreclosures.  You can find a ton of great resources there.  The following link should come in handy for you:
http://www.biggerpockets.com/bank-reo.html

Ryan Webber · Answer

Tylawdaboss, don't worry about your questions.  That's why we are here.

Tyree Nash · Answer

This was very informative. I will try to do a little more research on this site and about the numbers of different ways to gain capital. I'm a very young and eager REI newb so pardon the questions but I really appreciate the responses. I can see this board is very helpful!

Jim & Michele Wilcox · Answer

Welcome ... Are you saying you are looking to purchase property in California for in the price range of $55,000 to $100,000? I doubt that is possible. Do you live in California? If so, you should know that houses haven't been in that price range for many, many years. Even REO's won't be that low. Most REO's are listed at FMV or just a tad below even though there's work to be done on them.

With so-so credit and little money, you'll need to be creative. You might look into doing some subject to deals.

Do some reading around this forum and you'll learn quite a bit.
Good Luck.

Ryan Webber · Answer

First things first.  Welcome to the forum.

Okay, now let's jump in.

Focusing on only one way to find deals (REO's) will not take you very far in this business.  Focus on what you want to do (rehabs) and then figure out EVERY way you can find deals for that strategy.  Limiting yourself to how you will find deals is limiting your deal flow, which will limit your selection and your profits.

If you have limited funds (under $20K), so-so credit, and you are in a higher priced market, then starting out with rehabs is probably not your best strategy.  I would recommend you investigate ways to build up your capital before you jump into rehabbing.  Wholesaling, birddogging, subject to's, lease options, and contract for deeds all have good potential to help you develop capital without starting with much.

Ryan Webber · Answer

Lenders that have REO's use local realtors to sell the property.  You would need to have access to the MLS or a realtor to find them.

Charles Weisinger · Answer

i use weichert.com , craigslist.org, washingtonpost.com to find my properties.
i live in northern va.
I have no idea how to specifically search properties that are real estate equity owned by banks.

Please help.