All Forum Posts by: Laura Alamery

Welcome! This is definitely one of the best real estate forums on the internet.

When you say preforeclosures, I assume that you are talking about properties that have already a notice of foreclosure files, so you are racing against the clock in trying to stop the foreclosure.
This is a great phase to do a short sale or buying the note: you can stop the foreclosure that way, you have an eager seller to work with you (most of the times :) and the bank usually is willing to talk if you can present a great short sale package, with proof of funds letter and so on.
I usually can get a better discount and a better property in preforeclosure than REO: nicer properties are up for grabs when they hit the market as REO and retail buyers with loans in place are willing to pay more for the property than investors, obviously.

So in short, preforeclosures are a better deal if you are willing to negotiate a short sale or a note purchase.

You can include in her owner financing agreement a clause to the effect "Owner on title reserves the right to inspect the property at any time with 72 hours notice. If the property is not kept in the same condition as of the date of sale per this contract, owner on title reserves the right to renogatiate terms with the owner of record, including possible reversion of sale."
This way she feels she has some control on the situation.
On the day of closing between you and her, make sure you do an inspection report (just a checklist basically, like the ones you do when you rent a car :) of condition, repairs needed, etc. and take photos of any damages. Have her sign the report and the photos.

I wrote a Blog about Real Estate Syndication a while back.
Check it out at http://blog.realestatementorshiponline.com/?p=192.
It takes some time building trust and relationships to form a syndication group, but the sky is the limit and word of mouth will compound your efforts.

You have to check with the laws for your State.

I see this happening a lot lately - the owners were not properly notified.

Unfortunately it takes money and a lawyer to go after the lender for this negligence and to prove it, therefore since most of these owners lose properties in foreclosure because of money issue, it is a catch 22 situation.

They don't have the money to pursue litigation, therefore they might unjustly lose the property.

Yes, it is definitely important to keep an updated real estate business plan/loan package.
With the items mentioned above, I include specific itmes for the property in question, for which I am applying to get a loan.

These include:

Cover Letter
A. Photographs
B. Memorandum (Executive Summary)
C. The Borrower (Description of you and your company)
D. The Collateral (The Property in question)
E. The Underwriting (Financial soundness of your plan)
F. Recommendation (Summary)

You can "test" the yellow letter, but personally a nicely laid out business letter is better.
It is important what you say and how you say it: also something that draws the recipient attention on the envelope is important.

You have to strike a chord with them - if you are sending letters to people in preforeclosure, be understnading of their situation, without patronizing. Tell them what they need to hear: that you can help them out of a situation, avoid foreclosure, that they can stay in their house until you settle with the bank, that you can help them with moving expenses, etc.

My response rate has always been very good (5% or more), but I always put myself in the recipient shoes and I never used yellow letters.

Auditing services are a great idea for commercial property owners! I am always encountering owners with mistakes in their bills/vendors from sewer services, insurance, etc.
I would first contact agents that deal with commercial real estate and offer your services to their clients/contacts. You just need to educate the real estate agents to get your foot in the door and then you take it from there.
You can also do a search through the recorder of Deeds or buy an email list, but personal contact (via real estate agents, brokers, insurance agents) will probably be your best approach with higher return rate and lesser marketing cost.

Hot markets change constantly with the real estate market.
I think you have enough in your back-yard to keep you busy for a while - after that a google search will reveal what is "hot" at the moment. Realtor.com and CNNMoney put out good half-yearly reports on trends and good housing markets.

Adam, based on what you are saying I have a few recommendations:

1. Start with one property and manage it yourself. You have to know what to expect from a property manager before hiring one and you can only know by being one yourself for a while. That will give you a chance to organize the business and set some ground rules that you can work with.

2. $100k is a fairly good amount, but not too big in real estate. Use some of that money to wholesale/flip some properties "as is" (without doing any repairs.) Once you build another $30-$50k cash reserve, buy another property/multi-family to buy and hold.

3. Once you are ready to hire a property manager, find someone to work only for you (not one of these large property management companies) - that way you can control costs, management policies and you will profit more.