Dean Graziosi

Whether you are a new investor or a professional like Dean Graziosi, protecting your real estate investment is a top priority, and that means you must make smart business decisions.  When it comes to purchasing investment properties, there is no room to cut corners.  This holds true no matter if you are buying a rehab or flip property, or if you are buying a long-term rental property.

One of the biggest mistakes newbie investors make is overlooking the need for an inspection prior to a purchase.  This one mistake alone can sink you before you even get started.  The problem here is that new investors easily get caught up in the moment and they forget that there are good deals in every city and state.  Just because a home is cheap, does not mean you should buy it.  Don’t be too quick to jump if you have not done your research. 

If you are purchasing a property that needs work, not only should you get a proper inspection, but in the case that you still go ahead and purchase the property, it is best to hire a maintenance professional and get things fixed correctly the first time around.  Getting things repaired properly the first time will not only save you headaches, but thousands upon thousands of dollars in the long-term. 

Now let’s say you find a great deal on a multi-unit building and you purchase it without getting it properly inspected.  While it may seem like you have a sound investment, what happens when within a matter of months you find yourself with a leaky roof, air conditioning units that will not work and plumbing problems?  Not only will you find yourself with unhappy tenants, or no tenants at all, but you will be left with huge bills that may cost you everything.   

New investors should never take maintenance and upkeep lightly.  Likewise, if you are renting out your property, make certain you are screening your tenants.  Not only do you want them to pay their bills, but you want to make sure that they respect your property.  If you have repairs that need to be done and you are not certain you can do them correctly yourself, find a reputable company to do it for you.  The bottom line is that mismanagement will put you out of business. Managing your property correctly is the only way to protect your real estate investment.   

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Not too many years ago, if you wanted to find real estate for sale you turned to your Sunday newspaper.  Likewise, in the mid 1990’s, you could actually turn on the television and watch as local properties were displayed on a real estate channel by realtors across the country.   Nowadays, if you are serious about buying or selling real estate, you turn to the World Wide Web. 

No matter if you are a buyer or a seller; chances are you are quite familiar with searching for real estate online.  You may not know however, that real estate pros have been using the Internet to their advantage for many years.  Now with a click of the mouse you can find bank foreclosures, homes for sale by owners, realtors and brokers, as well as distressed and wholesale properties.  In fact, if you know where to look you will find that there are more properties than any one person could begin to filter through.

So where do you begin?  You can start by doing simple searches such as “distressed properties” or “rehab for sale”.  If you are new to the real estate game, you are bound to find many great deals on sites such as Ebay and Craigslist.  Believe it or not, it is actually quite simple to land a contract or two within days just by using these two sites.  If you prefer a more traditional approach to house hunting, try searching realtor websites and sites such as forsalebyowner.com.

There are many advantages to buying and selling real estate online.  Not only can sellers reach millions of potential buyers from anywhere around the world, but buyers, and investors in particular, can create deals on properties without so much as leaving their homes.  If the internet is not for you, don’t be dismayed.  Local newspapers still have a real estate section.  You will however, have far less to choose from than you did 5, 10 or 15 years ago. 

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Real Estate is still one of the best ways to invest and with today’s market having an abundance of foreclosure properties here are some general suggestions to help you buy foreclosures and add to your investment portfolio.

·         Be prepared to invest time into researching and preparation and it’s important to have patience when deciding to try and buy a property that is in foreclosure.

·         Understand that in most cases, foreclosure properties will require work as the original owners have probably neglected their home. A new owner should be prepared financially to replace, repair and even rebuild.

·         Researching is of paramount important to buying a good investment. It is important to understand the foreclosure laws of each state as they differ. If you’re planning on buying a foreclosed property in a state you are not a resident, you need to know what that state’s requirements are when dealing with foreclosure properties.

·         If you’re new to real estate foreclosure investing it might be best to try and buy from the lender.

·         Sometimes, the lender will offer to finance the property at a below the market rate or accept a low down payment. Lenders also often include title insurance.

·         It is also a good idea to look for “hidden” foreclosure deals…these are homes that have not been previously owned and usually the bank has hired a real estate agent to handle the deal.

·         If you’re a seasoned investor than buying a home just before it goes into foreclosure is a good strategy to use. Because the homeowner does not want to lose all of the equity in the property, he/she accepts a portion of the difference between the equity and the market value of the home.

·         This pre-foreclosure purchase is not for the new investor and most definitely requires persistence and a thorough understanding of the foreclosure process.

If you’re looking for a foreclosure property, follow some of the suggestion written about in this article and you should be able to find a great foreclosure property for your investment portfolio.

Happy hunting!!

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