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Anyone here involved in buying and selling real estate? Not just selling homes, but buying either foreclosures, bankrupt. etc?
I am just wondering what kind of training or license you need to have?
Also how did you get started? What is the best way to go about this?
Also what kind of money can be made?
Any other information would be great..
I just took a class on getting your real estate agent's license in Florida. The laws are different state to state, but as far as buying foreclosures or any other property goes, you shouldn't need a license to do that. There are listings of hud foreclosures on the hud website (do a search for it) by state. Call up any realtor and they can put in a bid for you on a hud foreclosure. However, if your bid is accepted, you have to buy the property, so you must be prequalified and should at least inspect the house first. A lot of times the scumbag who didn't pay his mortgage really trashes the place before he vacates it. There are a lot of books on this kind of investing, like the foreclosures for dummies or something like that.
It's very competetive, there are a lot of people looking for these properties. Around here, if the house is decent, it is usually sold within a few days of being listed. The ones that hang around for awhile are usually real pieces of shit.
Well, good luck with your ventures. Me, I hate this shit, found that out in the first 20 minutes of real estate class.
Many fortunes have been made "flipping" foreclosures or properties aquired from people in a bind. You do not need any type of lic to do this although having a RE lic would give you a shot at info days before something actually hits the market. The stuff that is left for the general public usually isn't so great.
As far as going into real estate as a profession you better be hungry and aggressive otherwise you end up like 80% of realtors out there making less than 28k per year.
Gl Bro
I dont know what state your in but florida you dont need a license to buy and sell homes. the big thing going on here right now is condo conversions. that means apartment complexes that were rentals get sold out as units to the public by the builder/owner. Usually they are high dollar condos or townhouses with a garage. I picked up 1 unit jan 1st for 206k and my neighbor bought 11 of them (bastard) he just sold the last one for 300k. 94k profit x 11 is pretty nice. I'm gonna sit on mine a while longer see if i can get more maybe. so you dont need a license just good credit and $$$. Real estate in my area is going thru the roof right now.
I do this as well and I can also say that the competition is really high. You're generally competeing with 4-5 people on bid day. It's all a numbers game thought. If you can accept the fact that you're not going to get most of the properties you bid on you'll be fine (1 of 10 you look at you'll bid on, you'll get 1 of 10 that you bid on if you're lucky and bidding correctly). If you're getting every property you bid on I guarantee you're paying too much for the places. (or even a high % of the places you bid on) To make money you need to be aggressive with you're bids.
It's also important to be good at "Comping". Meaning you need to be able to find how much comparable housing is selling for on the same street or in the same neighborhood. This will tell you what your market value will be once you're done fixing the place up (you will need to fix a foreclosure up 90% of the time). This along with your estimated fix up costs and estimated profit (what you desire) will dicatate the bid you place.
Having a license is great because I get to split commissions with every property I purchase. Helps with closing costs and such. You do not need one though to purchase or sell properties. You can simply find a closing company to take care of things.
It's important that your first property be a winner as the cash you make from that flip will break or launch most investors. If you bust on your first place you'll be extrememly cash strapped and your confidence will be hurt. You need to take your sweet old time in getting your first place.
Profits can be really good in some cases. I expect to purchase a property, fix it up, and get it back on the market a month after closing. I allow for another month to sell. I can usually expect $15,000-$50,000 per flip ( sometimes more but that's rare....I've also busted on a few which sucks but it's part of the game I guess). Taxes are a b!tch with this type of realestate because you become "Forclosure whore" ,for lack of a better term, by the IRS and they capital gain tax you to death. Tax returns are fat as hell though so it usually ends up alright. A good aggressive real estate accontant is your very best friend in this business. They'll make you a lot of money on the tax end.
Good luck and buy some good books and start reading prior to starting. There's a lot of money to be lost and gained in realestate and knowledge will help you to become one of the gainers.
What kind of money do you need to put down? I dont have alot of cash, and I see alot of no cash upfront programs(on tv..so take it for what its worth-lol)Quote:
Originally Posted by Receiver84
Also, are you basically buying the house and making payments on it, until it sells?
EX--I see a house that looks like a potential "winner", and I decide to go with it? What would I do next? Do I need to go to a mortgage company and get pre-approved or what? If you could give me a brief overview of the steps... that would be great!! You can PM me if you prefer..
thanks for anymore information bro, I appreciate it.
Buy some books and read them.
Plenty of them out there.
You can educate yourself for
a couple hundred bucks.
It will save you thousands.
Well, that all depends one your credit history. Although a lot of Agents will tell you that there aren't 100% financing programs for investors (meaning you wont be living in the property for at least 2 years), that is totally wrong. If you contact mortgage broker after broker you will find one that offers 100% (usually 80% first mortgage at market rate and 20% second mortgage about 5 points above market). This doesn't apply to forclosures...Only investment/rentals that were privately owned and sold. Now 100% only get you the purchase price of the home. Unfortunately there aren't many things you can do to kill the closing costs on a foreclosure. Buying a standard investment property would allow you so room to have the seller assist in closing but banks own forclosures and unless they are really desprite (which happens) you're flipping the cost of your end of the closings. Closing cost are usually roughly 5% of the purchase price of the building depending on your location in the counrty. Almost all of the charges in closing are total rip offs and it's unbelieveable what the gov allows these crooks to steal from you. I know the gov is working on some legislation to hopefully streamline closings and reduce this #1 limiting factor to investing. So then, You're looking about about $5,000 in closing for a $100,000 property. When flipping a protperty you MUST assume this $5000 as part of the purchase price and a peace of your profits. Remember that when you sell you're going to get hit once again with the same charges. As I said in my previous post. You can reduce your charges by setting up things your self and shopping around for the best prices but you're still going to get taken to the cleaners no matter what. Closing cost and taxes suck!If you buy for $50,000 and sell for $100,000 you'll be lucky to net $30,000 and that doesn't include whatever the costs of fixing the place up were.
Yes, you'll being making payments on the property prior to selling it. Keep in mind that forclosures in many areas can be picked up for much lower then market. In my area I can expect to offer many $50,000 offers on places that will sell for $90,000 to $100,000. I won't get many but the ones I do are good. You won't find any 100% investors for a forclosure ( until you're well established that is) so you'll need to put 10% down and closing costs. BUT, since you're paying a lot less it's not all that bad. You need to have your ducks in a row with carpenters and whatever else you'll need to restore the property for sale. Over time you'll develope great contacts and the best way to do so is to start meeting people in the industry. Back to the topic of the paragraph. You make payments but hopefully for only a month of 2. Then you flip the property and make your profit. That is why I say your first needs to be a good one and special care needs to be taken. You're going to struggle to get the cash to do your first place (Unless you have a silver spoon which I wasn't blessed with). You'll most likely only be able to scrounge enough for your first palce then you're on your own. Make a good profit on your first place and that will be more then enough for you 2nd and 3rd places combined.
You will need to be pre-approved for a mortgage prior to making an offer. This also helps get your offer accepted with all real estate purchases. See a broker in your area to get pre-approved and then get a current letter of approval for every offer.