Agent told me Foreclosures are a waste of time.

17 Replies

Hey Guys and Gals, I had the privilege of listening to Lisa Phillips Podcast today, Great Job Lisa! After listening to many other podcasts and reading multiple discussions I see a common strategy is to buy foreclosed homes for long term rentals. Im very curious about this, so I figured BP was a great place to gather more information on the process. Im curious about the pro's and con's of this type of investing….. Im currently working a 14 days on 7 days off schedule and have an interest in buying properties around the 30-60k level. I understand i won't be in the best areas of town, but i believe i can find some descent neighborhoods to invest in, with the use of a good realtor and property manager. I figure I can cover the mortgage for a few moths while i do the necessary repairs to get it rent ready. Rinse and Repeat. I was looking at foreclosed homes and possibly looking into using Homepath to finance a couple investment properties (just a thought). My real estate agent, which i do like, told me buying foreclosed homes was not a good idea and the whole process usually ends up being a wast of time. Which seems to conflict with most of what I'm learning on BP. He says he also owns a few rental properties, so I'm open to his advise, but just want to get others opinions on this situation. Can you give me your thoughts and point me in the direction of any good educational videos on investing in foreclosed homes.

Thanks, Dusty

I am also new; my 1st month investing. I'm closing on my 2nd house next week and both the properties I have bought were foreclosed homes. It was not my intention to seek out foreclosures. I just looked for properties that fit my criteria and made an offer. Offer was accepted and I got an inspection to make sure there were no surprises that I was not equipped for.

I think everyone will have a different opinion of foreclosed homes. Mine is that it all comes down to the numbers. If all the numbers align then who cares.

Dump your agent and surround yourself with people that will help you accomplish your goals.

Originally posted by @Dusty Warner :
My real estate agent, which i do like, told me buying foreclosed homes was not a good idea and the whole process usually ends up being a wast of time. Which seems to conflict with most of what I'm learning on BP. He says he also owns a few rental properties, so I'm open to his advise, but just want to get others opinions on this situation. Can you give me your thoughts and point me in the direction of any good educational videos on investing in foreclosed homes.


Dusty, why on earth is your agent telling you this? Because he is an investor and wants to keep all the really good deals to himself? When you buy a foreclosure, you typically have to spend some money fixing them up, but they can absolutely be a profitable venture! Half of the properties I own have been foreclosures!

I can't remember the last time I bought something that wasn't a foreclosure.

that comment from your agent makes zero sense. perhaps something your agent is saying is being lost in translation from he to you to us? certainly someone would never make such a blanketing statement, which is largely false.

They can be more work and you should expect to make a lot of offers to buy one. Banks usually don't pay the full 6% commission, which might be the real issue here.

worst advice ever. I think you need a new agent my man @Dusty Warner

translation: foreclosure = more work and less pay for your agent. Dump them if they can't see the forest through he trees. Building/fostering a long term relationship with their client should come before short-term gains.

Wow!!! Thanks for the quick replies!! I figured that I would get this response, but wanted to get some advise before I started looking for another agent. He seemed to be a knowledgeable guy, but he is probably looking out for his best interests. Thanks everyone!

Can someone point me in the right direction where I can find a Dummies guide to buying foreclosures.

Thanks again, Dusty

Originally posted by @Britt Abbey :
translation: foreclosure = more work and less pay for your agent. Dump them if they can't see the forest through he trees. Building/fostering a long term relationship with their client should come before short-term gains.

This is prolly spot on. They really are a pain compared to buying from an owner.

You should look into a new Agent. Most of my portfolio consists of them.

I agree with everyone else here. Yes, foreclosures can be difficult, but to just disqualify them as a whole is silly. In my opinion, foreclosures, when I'm working them as the Buyer's agent, have gotten so much easier to close in a reasonably smooth and timely manner within the recent past - as long as the Buyer can remain realistic.

A good deal is a good deal: sometimes they are just more difficult to close. I'd take a foreclosure over a short sale any day!

Originally posted by @Hilary Karaman:
I agree with everyone else here. Yes, foreclosures can be difficult, but to just disqualify them as a whole is silly. In my opinion, foreclosures, when I'm working them as the Buyer's agent, have gotten so much easier to close in a reasonably smooth and timely manner within the recent past - as long as the Buyer can remain realistic.

A good deal is a good deal: sometimes they are just more difficult to close. I'd take a foreclosure over a short sale any day!

yup. Major thumbs down to short sales.

In the end you want to get to the point where your Real Estate agent has zero influence on you in the decision making process. Thats where you need to have your education level at. These agents are a nessasary evil until this system revolutionizes itself like the stock market did. Yes some folks will always need to led by the leash to do every deal but increasingly many dont need these agents for a thing. A total waste of money and just another person holding out their hand to get paid.

Being educated on each deal is your most powerful tool.

Thanks y'all. Jay is it possible to make an offer on a foreclosure without a realtor??

Quite honestly, it's best to try something out first to see if it works for you. There are those who specialize in this area and have been successful. On the other hand, there are others who have tried and have not.

We all have different experiences and really do not know what the future will hold for us. Though, it's best to try first to get the experience which will produce an outcome. Without trying, there's no way to make a determination - it's the experience that will enable you to get the knowledge firsthand.

Hope that helps, good luck!

Thanks Rachel... I'm definitely going for it... Im searching and analyzing rental properties now. Figure my time is limited before I start making offers, so I guess I'm trying to learn a little about everything right now;)

Dusty,

The quick answer is no.

The system needs to be changed just as I reference the stock market. It once cost a $1000`s of dollars for a single stock trade. Not you can do it sitting on the bus for $9 on your phone. Everything in todays world is buyer beware as-is so I really dont need to pay someone thousands of dollars to unlock and relock the house for me. Its a joke. . Its time for a change in this industry. Certainly there will be space for some just like a few brokers remain in the financial world but nowhere near what we have today. Its a racket and nothing more.

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