Foreclosure
Profiting from the Real Estate Bubble: Foreclosures
By John Appleseed
Nov 6, 2005, 02:39

Foreclosure investing 

Foreclosure investing normally involves buying preforeclosure or buying at the auction. All of these methods have their own advantages and disadvantages. None is better than the other but knowing about each other will enable you to decide which way to go in your property investment. 
Assessment of foreclosure investment types

Buying Pre-Foreclosures has its good sides. You can earn you 20% to 35% discounts on going market rates, and that means making great profits on your foreclosure investing. You also have the option of low cash down payment if you can work around things.  Again, you have the opportunity to research on all properties coming up for sale and then weeding out ineligible ones.  Lastly, you can get favorable sale agreements.

Preforeclosures as a way of foreclosure investing has its bad side as well. They can be difficult to get in touch with the real owner of the property.  Again there are a lot of competing interests and the court research can be very tiring and frustrating. Lastly, it calls for many negotiations with those who hold the lien.  

Buying at the auction is another alternative in foreclosure investing. Here too you can obtain very good discounts. Additionally, you can have up to 45% below market prices and boost up your ROI. For people who want to make big one-time profits in foreclosure property, this may be a good option.  
Auctions have their own down sides. They are frequently postponed and you will realize that it is waste of time and effort to prepare thoroughly for them. Another disadvantage with this type of foreclosure investing is that you cannot inspect the property for sale.  The only way to obtain some background information about the property is to do some background title research, which can be expensive. The payment terms may not be favorable. In addition, you will need certified checks for 10% of the purchase price and you are required to pay up the balance quickly, sometimes in a matter of hours.

Both foreclosures and auctions can compensate each other in your foreclosure investing. It is a matter of deciding which method to use at which point in your investment campaign.

John Appleseed is contributor to http://www.bankforclosurelistings.com, where his insider knowledge of
are freely shared.