HomeVestors Knows That Investing In Foreclosures May Not Be For Every Investor


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Many investors consider investing in foreclosures but there are many other investments on the market that are more profitable.

Dallas, Texas HomeVestors is the nation’s number one home buying franchise and has helped real estate investors purchase 50,000 properties over the years. The company knows that there is a great deal of information regarding investing in foreclosures. Many investors have either participated in investing in foreclosures or have at least considered it. There may have been a time, a few years ago when it was a good idea, but now, most cheap foreclosed properties are off the market.

Investors who have a stockpile of capital and can purchase many properties at the same time have the upper hand when it comes time to investing in foreclosures. Small time investors should think creatively and look elsewhere, as there are better investments right in front of them.

The big problem with investing in foreclosures is that an investor is dealing directly with the bank. Banks only participate in traditional real estate deals and aren’t interested in hearing buyer demands. The banks don’t generally drop prices, even when something is majorly wrong with a property.

As foreclosures are drying up or are being reduced artificially, there isn’t much desperation from lenders to sell their inventory quickly. In fact, many banks are taking their foreclosures off the market in order to sell the ones that are still listed, for more. They are reducing the competition and raising their prices. Small time investors can’t take advantage of this due to a lack of inventory and leverage.

If an investor is still considering investing in foreclosures they should allow their attorney to read through the purchase agreement. It is also imperative to hire a professional inspector who can look through the property and alert one of any major problems. Expect that these properties will have their share of problems, but don’t expect that the bank will be willing to reduce the price or fix the problem.

Instead of investing in foreclosures, investors should scan the market for desperate sellers who are willing to part with their property for either a reduced price or are willing to make a creative deal, like seller financing. These sellers are everywhere and allow an investor to use their education and creativity when securing a deal. This education is what allows small time investors to find deals and capitalize on them. Banks in general aren’t interested in working out creative deals, as they don’t stand to gain much from them.

About HomeVestors of America Inc.

Dallas-based HomeVestors of America, Inc. is the largest buyer of houses in the U.S., with 50,000 houses bought since 1996. HomeVestors trains and supports its independently owned and operated franchisees that specialize in buying and rehabbing residential properties. Most commonly known as the “We Buy Ugly Houses®” company, HomeVestors strives to make a positive impact in each community. In 2012, for the seventh consecutive year, HomeVestors was among the prestigious Franchise Business Review’s “Top 50 Franchises,” a distinction awarded to franchisors with the highest level of franchisee satisfaction. For more information, visit www.HomeVestors.com.

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