Pretty homes on MLS - Posted by Ehab

Real Estate Investing
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Posted by Ronald * Starr(in No CA) on July 28, 2003 at 10:55:00:

Ehab---------------

Regarding lender-owned properties. Ask yourself: “If I were a bank employee what would I do?”

Occasionally, it is true you can get a good deal from a lender. Most of the time in most parts of the country, forget it. Only when the demand is low can you expect to find very many good deals from lender-owned properties.

Good InvestingRon Starr**

2

Pretty homes on MLS - Posted by Ehab

Posted by Ehab on July 27, 2003 at 18:12:27:

I’m looking to rehab and retail homes, but every now and then I find a pretty home on MLS in foreclosure that is priced right that I can by at 65% LTV.

My question is, if a pretty home is having a hard time selling on MLS at 65% LTV what makes me think that I can buy it and retail it at 100% LTV if doesn’t even need repairs?

I understand why ugly homes are discounted and can be hard to sell, but what about a pretty home that’s discounted with no repairs?

Thanks.

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Please don’t confuse LTV with FMV - Posted by Ronald * Starr(in No CA)

Posted by Ronald * Starr(in No CA) on July 28, 2003 at 24:53:37:

Ehab------------

LTV is “loan to value” ratio. The loan amount against a property is divided by the property value and then converted to a percentage.

FMV is “fair market value.” It is an estimate of what typical buyers in the area will pay for the property, as other buyers have been paying similar prices for similar properties recently.

Now, if a property is not selling at 65% of FMV, there is probably something wrong with it that is not obvious. Or else the real estate market is very slow in that area for properties of that type.

If the asking price is truly 65% of fair market value, that sounds like a property worth considering buying. Buy and hold for positive cash flow.

Resell if you can for a profit. However, you had better know the market values better before you start trying to pull off deals like this. If it has been on the MLS for more than a week, it is not being listed at less than 80% if market value, I believe. Probably not being listed at less than 90% if FNV.

Good InvestingRon Starr**

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Re: Pretty homes on MLS - Posted by Mike

Posted by Mike on July 27, 2003 at 21:28:56:

Well the home didn’t sell for alot of reasone I find that buying a home and doing nothing else but making really sweet terms to a prospective buyer is all that it takes.

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Re: Please don’t confuse LTV with FMV - Posted by Ehab

Posted by Ehab on July 28, 2003 at 10:34:09:

Thanks Ron…I was confusing LTV to FMV. However, I was under the impression that banks do list foreclosures on MLS for way below FMV at times because they are only trying to recover the balance of the loan and not necessarily make a profit. True?

Thanks.