Finally!! An REO acquired

[Rich Weese]

As many know, I moved from TX to FL to buy RE about 1 1/2 years ago. Bought a self storage facility before moving here. It has been great.
I was trying to buy foreclosures or reos on sfrs also. It has been a pain in the butt. Tricky lenders, realtors and most properties turning into auctions or taken off the market.
Finally acquired a 4 br- 2 ba- 2 car in Cape Coral. for 61K. It took Wells 4 months to close.
I'm posting this from start to finish and I think it'll be good, but not sure it is worth the time and hassle. Closed on 2-23. Demo portion will be finished by 3-15 and projected re-hab is under 10K. Expect to list in the 90's.
My friend Will listed a re-hab start to finish in CA with a 90K profit. This will not have that obviously, but I've always been more concerned about % of profit. These smaller homes also allow almost anyone to do one, due to price range. I would hope I might net 15-20K after all is said and done. Depending on # of months to sell, I think annualized return will be very comparable to Wills' but it wasn't easy to find this home. More info to follow.
If this works well, I might have my asst. continue doing them. If not, I have a different idea for investment. Good fortune and fun to all. Rich.

[J Scott]

Start building relationships with the big REO listing agents and it should help with your percentage of accepted offers. Once they know you (and know that you're a serious buyer), they'll let you know when they have a bank that's desperate to sell a property, they'll help push your offers through, and they may even tell you high you'll have to offer to win a property when competing against other investors.

Also, once you know your market down-pat, you'll start to get a good idea of how much banks will accept for various types of properties in various conditions that have been on the market for various lengths of time.

We average getting about 1 out of 5 offers accepted on REOs (we're very picky), and I know other investors who have even better ratios.

So, it's definitely possible to get enough REO projects to keep busy, but it takes a good bit of upfront work and there's a learning curve with respect your market and the agents in your market.