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Foreclosure Investing

Discussion in 'Investments' started by mtayp01, Oct 10, 2015.

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  1. mtayp01

    mtayp01 Member

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    I just read an article about this recently--purchasing foreclosed properties at low prices, renovating them, and then eventually selling at a profit. Sounds promising. Is anyone here into this kind of business? Care to share your experiences?
     
  2. dyanmarie25

    dyanmarie25 Member

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    I think that's a good business idea for those people who are somehow interested in making money with real estate. I haven't been into this kind of field yet. Probably I would try it once I get the budget for it.
     
  3. pwarbi

    pwarbi Member

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    Here in the UK this is happening more and more, and as house repossessions continue to rise, I can see it becoming even more popular. Often when a home gets repossessed, the mortgage company will put the property up for auction and there are a lot of bargains to be found, and if you can find a house relatively cheaply that only needs some cosmetic work doing, then you'll quite easily be able to make a profit.

    On a business basis it does make sense, I wouldn't become involved in it purely for the moral reasons. I see it as making a profit out of other peoples struggle, and instead of lenders evicting people and selling off their family homes, I want more to be done to help people who are struggling.

    If I was at an auction waiting for a cheap home to be sold to me, and all I was interested in was making a quick profit I'd see myself as a bit of a vulture, so it's not something I'd ever do, no matter how much money could be made.
     
  4. It all depends on the type of property, where it's located, the local market, and how much money you need to put into it. Like pwarbi stated, if it just needs a little face lift and you get it for significantly less than market value, maybe not a bad idea, but if it needs a makeover from A-Z, probably a loss situation.

    I agree, it is an opportunity that possibly stems from an unfortunate occurrence. However, there are a lot of people that simply let their homes go "under water" if it's simply not worth as much as what they owe. That doesn't necessarily put someone out on the street. Regardless of the reasons behind them, they still occur and it is always very nice to see someone purchase a property and fix it up to add more aesthetically pleasing features to a neighborhood.
     
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  5. pwarbi

    pwarbi Member

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    I agree and not every case is a person being evicted due to no fault of their own, and some people will just decide to stop paying the monthly payments for their own reasons.

    If they do just decide to walk away from the property, they'll usually leave it in a state of disrepair, but the ones who have tried to save it and stay there will in general have looked after it as they still hope it will be their home.

    That's what I don't like about the whole concept behind it, if your getting a well looked after property, at a knock down price at an auction, more often than not it's been a family home that they just simply couldn't afford to keep.

    I'm not usually sentimental when it comes to business, but when it's a case of people being homless, I don't think the lenders do as much as they can to help the people, because they know that there will be a string of other's more than willing to snap the property up.
     

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