Discovering How To Buy Bulk REO Properties May Be the best Way Out Of This Government Caused This Real Estate Disaster…

“Bulk REO Real Estate Investing

It seemed to be a good morning the young real estate investor stood in the flesh in front of the mirror. No wispy spirit, this was a man in the flesh,  bone, muscle, and brain. The morning light shined in his eyes and his eyes shined back.

[pullquote]The man swore; "This is the day it all makes sense! All the hard work is going to pay off!"[/pullquote]

His mind wandered as he tied his tie. I'm getting rid of this sport coat! Something much more stylish fits me. Maybe a long over due vacation, back to Colorado he thought.  Still day dreaming on the way to work. Maybe I'll get a new car?  But I'm keeping this Toyota!

The phone rang a voice on the other end said. I'm terribly sorry to call so early but I just wanted to let you know I can't meet you today. This is quite embarrassing and I don't know how to say this but....  I met with a lawyer over the weekend. and, we'll, I'm filing for bankruptcy so I can't go ahead with the Short Sale. I'm sorry but my attorney assures it's the right thing to do.

The man hung up the phone and pulled over to the side of the road. His head sunk into his hands. "Boy what you going to do now?" he disclosed.

[pullquote]"It can take up to 1 year or more to do just one short sale deal."  And that's if the planets are in-line.[/pullquote]

In the last few years it can sometimes feel like you are Indiana Jones searching for some lost antique treasure. Only for many of us its searching for "The American Dream"  As soon as you start getting close you find out "Darn" "Bum information"

Then you get to back track and get back on the trail. Make things solid again. That was me three years ago. I had spent thousands of dollars learning how to hunt down short sales. That when I found out:

"Just like Edison finding out one more way not to make a light bulb. All my work was not in vein because luckily for me I had something to go to."

[pullquote]This was at the end of the Savings and Loans Crash of the 1980's Looking back, I should have stayed with buying bank owned REOs. But, like all good things, the market recovered and all those good deals got sold off.[/pullquote]

Talk About A Reality Shift.

[pullquote]This got me into the Bulk REO Business.  And on this blog I teach people the REO  Business.[/pullquote]

I post about every week or so.  I you have an RSS reader you can subscribe to my feed and you will get real time updates to your reader. Please leave comments on the post. I'm a real person and I''ll get back to you're questions and comments  as fast as humanly possible. Over to the right are different categories with articles and videos for you. Feel free to wander around the blog and don't forget to add me to your favorites page. I worked hard on putting all this content together and if you feel it has value please share this with your friends on twitter, and facebook.

Best Of Success!

Mark B. Bradley

St Louis MO USA

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This article is 1st  in the series on bulk REO Real Estate Investing.

Breaking... The Real Estate Disaster Continues To Plague US Real Estate Investors, Here's a snapshot of the current real estate market [pullquote]I was getting a little tired of running multiple companies with 20 to 30 employees each.  The brutal truth was while I was climbing the ladder of entrepreneurial success. I found I spent an every increasing amount of time away from my 4 children.[/pullquote] By these numbers, on average 278,297 bank owned properties remain unsold with over 300,000 added to banks inventory of Bulk REO properties each month. In this article you will find out how you can take advantage of this huge back log of bank owned Bulk REO properties. But there is help in sight. 4 years ago due to mounting tax pressers and suffering form burn out. I divested many of my real estate properties, with a little help from the IRS, I was getting a little tired of running multiple companies with 20 to 30 employees each.  The brutal truth was while I was climbing the ladder of entrepreneurial success. I found I spent an every increasing amount of time away from my 4 children I made a career move and sold the office building, downsized and set up a home office in the dining room. I wanted to spend time with my high school aged kids.

The reality They Must Sell! Foreclosures = REO = Opportunity!

This was the best most fulfilling time of my life. Watching the kids grow into young adults as they started heading for college. I soon realized college was going to cost way more than I thought. Due to a few rough years the college fund had been depleted to the point where I needed to make a big chunk of tuition money and I needed o make it fast. At the time the real estate market was just starting to decline and I keep seeing TV and Internet ads for How to make a fortune with Short Sales and Foreclosures.

[pullquote]I was able to get a few deals going but what I found out was "Buying short sales and foreclosures was a lot of work. Emphasis lots! When you're out there looking for home owners in distress didn't really fit my personality. [/pullquote]

Since I was a real estate professional it only takes a few ads like this and I say to myself "If they can make a million dollars with foreclosures I Can too” I must have went out and bought dozens of short sale books, foreclosure courses, and went to many high priced seminars from the latest Foreclosure Guru and went to Amazon and bought all the books I could find on how to make money with foreclosures. I tore into the programs and books and quickly started doing what they told me to do after about two months the market crashed and I really had to make some fast money.

Many of the home owners were just emotionally and financially devastated, Even though I knew I was helping them out I still could feel all the fear and frustrations they felt. Many times I just became a friend and consoler as these distressed home owners would pour their hearts out to me. And still after all that did not get the deal. I was very frustrated at all the time it was taking to land good deals. Even though the market was collapsing all around me.

[pullquote]My back was against the wall tuition was due at 3 colleges. This short sale thing was not working like all the real estate gurus said. I started thinking to myself "Could all those fancy TV real Estate gurus be wrong?”[/pullquote]

I keep worrying that if I bought this house what happens if the market drops another 20% what then?  Or, is the president going to outlaw the mortgage interest deduction for homeowners. I just could not accept that they could be wrong. Here I was, Mr. Real Estate and I just spent tens of thousands of dollars on Short sale seminars, courses and books.I just sank in despair and agonized over what to do for two weeks, I couldn’t eat, couldn’t sleep.

I knew I had to change my whole way of thinking. I was torn between trying to make my short sale business work and taking a leap ahead into something new. I even thought about getting a part time job at the mall to sell men’s wear for the Christmas season. That is when I found out there was a dirty little secret that the foreclosure guru's were not telling me.

"It can take up to 1 year or more to do just one short sale deal."  And that's if the planets are inline.

I broke down the whole foreclosure short investing course on the next few pages.  Yes, you may have paid $2 $ 3 or even 5 thousand dollars for a short sale course or seminar but no one ever disclosed this information you will learn right here. I have broken down the steps to completing just one short sale deal to 5 major steps. And believe me that was hard because there are about a gazillion steps to each of these 5 steps.

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Why Go for Bank Owned REO Properties Instead of Short Sales?

Question that often pops up is – why go for Bank Owned REO properties instead for short sales? It really all comes down to which method brings you more money, at lower risk, faster. With current market conditions real estate investing is hard enough. Now more than ever, it is time to go with strategy that guarantees success.

Comparing short sales with Bank Owned REO properties is really comparing pears with apples. The script is the same. The differences are in lender’s legal ownership of the property, sale conditions and consequently the sale price.

It is a familiar story. Homeowner is behind on their payments and the property is heading toward foreclosure. And it goes two separate ways from there.

[pullquote]The bank’s motivation is to sell properties fast. While bank will not go unreasonably low, the highest price will still be well under the short sale price. And auction style sales means you will know where you stand in short order.[/pullquote]

Short sale is sale of distressed property before it hits auction. The property is owned and sold by the homeowner. Bank or mortgage lender agrees to discount a loan balance on the property, the owner sells it for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender. Consequently, homeowner will try to get as much as he can out of the sour deal and hike up the price.

The homes purchased are as is, and chances of having homeowners do repairs are slim to none. Can you blame them? In short sales, the homeowner’s motivation is money. And 100% of the time they will go for the highest offer. Similarly they will wait to make the sale to make sure they receive the highest offer. You may spend good time waiting and never hear back from the seller. Waste of time and money, wouldn’t you agree?

In bank owned REO’s, the bank owns and sells the property. Bank owned REO property has been acquired by the lender through a foreclosure action. Banks really do not care for keeping the property. For them property means maintenance. And maintenance means loss of money. This is why banks will let the bulk REO properties go for much less than the loan balance. In fact, banks is so willing to get rid of REO  properties that it is possible to make an offer contingent upon an inspection to see if any major repair work is needed. And with the owner out of the picture buying Bulk Bank Owned REO means no haggling, great price and in short - a sweet deal.

The bank’s motivation is to sell properties fast. While bank will not go unreasonably low, the highest price will still be well under the short sale price. And auction style sales means you will know where you stand in short order.

As a serious real estate investor you have to ask yourself a question:

1. What is your goal? Serious money or counting pennies?
2. Are you willing to wait and risk ending up with a zero?
3. Or - would you rather swoop in and score a handful of properties for a great price at …say…..50% off?

I think the answer is clear. To make good money - you must act fast. See the deal, grab the deal and run with it. Otherwise you will be left out in the cold.