Re: property available after auction - Posted by Tom(PA)
Posted by Tom(PA) on October 18, 2005 at 15:56:20:
As soon as a bank starts the foreclosure process the bank asks
local realtors to perform a BPO (Brokers Price Opinion). This is a
market analysis of what other houses on the street, and area in
similar condition are selling for. They have this done shortly
before and shortly after the Auction. Point is- it is a myth that the
bank is dying for anyone to buy the house. They have the
information and know what market value is. They sell it
accordingly. Right before it goes on the market- 1 to 3 realtors
have taken interior pictures and informed the bank on condition.
In my opinion REO’s are a great place to purchase homes you plan
to rent or buy to live in because they are generally 5% to 15%
below market value. The homes are generally pretty neglected.
People don’t choose lose their homes. They are the product of
divorce, death of the main bread winner, illness. If they can’t pay
the mortgage- chances are they are not fixing the roof when it
leaks, windows when they break, or updating.
I flipped an REO earlier this year and only made about $10,000.
Once I got in there I found a lot of things I had to address. I spent
4 months on it and for the time and energy- I won’t do it again.
Spend your time on pre-foreclosure and help someone out. It will
be a win-win and you will make a lot more money.