Just yesterday, I attended a foreclosure sale, that was literally packed full of other investors. I’m sure it’s pretty much the same in your area. The home being foreclosed on was worth an estimated $35K in it’s as is condition.

It was amazing to see the bidding start out at $20K and itch its way upward and end at over $50K. And what was scary was some of these investors bidding didn’t know if the foreclosing bank was a first mortgage or a second!

That’s the first sign of a disaster. If you’re going to bid at the auction, then know what you’re bidding on and what position the lien was in. It’s not a pleasant experience to win a foreclosure auction, only to find a superior lien that has to be paid off before you can sell. That’s never happened to me because I’ve always done my due diligence.

These guys got too emotionally involved in the bidding process and lost all reason for buying at the foreclosure sale which was to get a deal at a deep discount. Anyway, what do you make of a foreclosure sale that happens this way?

Do you take part in the bidding war? Or sit back and have a bitch session about the situation? I think not. This is an excellent opportunity to get to know others with deep pockets. Simply observe what’s going on around you and network to get to know the other guys bidding.

See, these guys are an excellent source for private money or to flip your deals to.

If you fail to see this as an opportunity, then you’re a real knucklehead. Where else can you find so many red-hot, motivated buyers, all at one place with money ready to buy deals?

That’s it for now; I’ll be back in a few days to finish my article on the Desperation Factor.

You could say that I don’t fall in love with all the various real estate techniques that are available. See, they are only tools. For example, preforeclosures, lease options, and other buzzwords for real estate techniques are not the end all be all method to making money in real estate. They are awesome techniques to say the least, however there is one common factor among all real estate transactions regardless of the technique that you use. It’s what I call the Desperation Factor.

Some call it motivation; I like to refer to it as being desperate. Desperation or motivation should be your number one best friend while you are constantly looking at deals with an opportunistic strategy. [Read more...]

In my previous posts,

I’ve discussed the importance, the downright musts to flipping on your Real Estate spy cap. Pretty much the same way that Superman did in the phone booth.

Now, what I’m about to show you is top-secret stuff that will peeve many investors off, as it will exploit their exact methods to doing deals.

Have you noticed in the past several years all of the ads offering you lists of foreclosed houses and that you can buy these homes at deep discounts at foreclosure auctions? Many of these will also advertise cars, homes, planes, and boats. I remember thinking as a teenager, “if we could just be in the know on some these auctions”. Well, let me tell you these auctions are no longer a secret. If you attend one of these foreclosure auctions, you’ll see exactly what I’m talking about. Most people are in the know about the auctions, yet they are unaware of what I’ll be showing you here. Now, most of these lists are a complete waste of time and money as you’ll be in the know when it’s too late.

First off, every deed and mortgage is a matter of public record. In case you didn’t realize this, it’s all recorded at your County Recorders office or at your Count Courthouse. For a list of these courthouses, go to http://www.netronline.com and get the address and phone number for your area.

Next, make a personal visit to your county recorder’s office. You’ll want to ask the clerk where they store all of the deeds and mortgages. They will carry you in a room full of these thick books all filled with mortgages, judgments, deeds, and other property information.
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I sincerely believe before you attempt to do anything you should carefully analyze the situation to come up with a doable yet flexible plan for attack your market . This analyzing should include sizing up your competitors or what will be your competitors in the real estate marketplace. I also have the belief and you should as well that your competition can help you conduct your market research.

What if I told you of a way to know exactly how to spy to see what you’re competitors are doing so you can outshine them every day of the week? What if I told you there was a way that you could position yourself totally different from all the other “We Buy Houses” crap that you see out there?

Just for example, visit your county recorder’s office to see who’s doing what. The recorder’s office should become one of your best friends for market research. Here, you’ll be able to see how many foreclosures occur each and ever month, plus if you have the names of investors you can conduct research to see what they’ve been up to.

Now, I’m venturing off to say that most are wasting a lot of time and money on real estate advertising that could be better utilized.
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What is the secret formula for escaping the rat race and becoming financially free? Well obviously, your passive income must exceed your expenses as described in Rich Dad Poor Dad. In Robert Kiyosaki’s best selling book, Rich Dad Poor Dad, he discusses how the game of monopoly explained the way to wealth. In the Monopoly board game, 4 green houses are turned into one red hotel, right?

Well, let’s apply this to real estate. As one former mentor of mine stated, you use the 4 green houses as your deals to generate cash then converting that cash into a red hotel, which is in turn your cash flow. The red hotel could be a bigger deal like an apartment, an office complex, even a business, or anything that can earn money while your not physically there.

As an investor you should never focus on holding properties starting out to build wealth. Many of the late night infomercial gurus tell you how easy it is to cash out at closing and how easy it is to create cash flow in real estate. I want to inform you of something they forget to leave out: Single Family Homes are not designed for cash flow!!!

They are designed for one thing for investors – to generate cash. You should first focus on building a system in order to flip these types of deals so you generate cash. Then and only then, you should turn to invest the cash into a bigger deal for cash flow.

[Read more...]