Why investing in hud home ?Posted by Nick Niesen on November 8th, 2010 I get asked all the time by new real estate investors if investing in hud homes is a good strategy. I will be recap in this article what I tell them?. The increased demand drives up the price and new investors tend to get any and will buy based on emotion instead of logic because they ?just want to get their first deal?. If you pay too much for a property, you will lose your shirt on the deal. That?s why it important to not overpay for the property because you make your money on a property on the day you buy, not the day you sell. Short Sales are a great way to guarantee that you won?t overpay for properties. If you are wondering ?what is a short sale ?or are wondering what the ?definition of a short sale is?here you go. A Short Sale is when the lender accepts less than what is owed on a mortgage on http://www.realestateforeclosuresinvesting.com> home foreclosures. All of The deals are no money down. The ability to own houses without having to make monthly mortgage payments. Preforeclosures and Short Sales are extremely easy to find right now. You may here some real estate speakers say to stay away from foreclosures because there is too much competition. Well that was then and this is now. They are teaching old information because they are not currently practicing what they preach. I am actively buying and selling foreclosures in my own backyard and I know what works and what doesn?t work. And I have to tell you there is no competition for preforeclosure and short sales now because there are so many of them. Short Sales are easy to get because it doesn?t require you to do a lot of negotiating with the seller because they know they don?t have any equity and they?re just looking for a way out. You are their solution! I love working with short sale sellers because they are the most motivated sellers out there. Short Sales are the most profitable quick turn deals to do in residential real estate because you?re making all of your profit on the discount with the lender One of the biggest benefits of the short sale business is that it works even better on Luxury Homes. The banks are more flexible and more negotiable on larger mortgages. Banks don?t want to take houses back and they definitely don?t want to take back Luxury homes. It takes the same amount of work to do a deal on a luxury home than it does to do a starter home. The difference is A Luxury home pays 10 times as much profit. Its like doing 10 deals in one and when you combine the short sale strategy with luxury homes, you?ve got the golden ticket. You See, Banks are in the money business. They?re not in the http://www.realestateforeclosuresinvesting.com> Real Estate business. They don?t want to own any properties. Their only interest is making interest on their money. Foreclosing on homes is a hassle they have to deal with because it?s a cost of doing business for them. The sooner you understand this the sooner you will realize how huge this opportunity is for you right now. When banks lend out money ? they have to keep a multiple of 5 times the amount of money they lend out in reserves. When a loan goes bad, it?s now considered a non-performing asset and that limits the amount of money they can lend out. It costs a bank a minimum of $30,000 to foreclose on a home. They would rather take a discount on the mortgage and get that bad debt off their books so they can lend out more money. You are the solution for them. Banks need you to help them liquidate their houses so they can get rid of their bad debt. You are doing them a great service. Like it? Share it!More by this author |