Essential Stages In the Process of Real Estate Property Acquisition

Real estate projects can take an emotional toll on any new investor who does not have past experience in property acquisition. Those interested in launching their careers through purchasing foreclosed and pre-foreclosed property have even bigger fish to fry, since legal matters have a huge impact on how long it will take you to purchase the real estate property of your interest. However, there is hope for aspiring real estate investors, since there are several stages you can follow, to ensure that you get into a stress free business deal.

The first stage is to scout for a suitable location for purchasing real estate property. This will of course, be determined by your financial capacity at the time of purchase. Most first time real estate investors seek the help of financial institutions through loans. You can seek the advice of a financial adviser to know whether that is an appropriate strategy for you.

Once you have decided on a location, it is time to start looking for real estate property on sale in your area of interest. This could come in three options that is, foreclosed property, pre-foreclosed property and buyer sales done directly by the owner or the agent. It is important to focus on real estate listing companies as a source for possible deals because buyer sales can be a bit more complex and time taking compared to the former. In addition, listing companies gather all the information you require about the property which saves you time since you can also draw down on multiple properties at once as opposed to buyer sales.

Foreclosed real estate property is property that has been repossessed by a lender, from the borrower due to inability to repay an outstanding loan amount and the interest. Such property is sold at auctions normally at a price below the market value which is advantageous to the investor.

When scouting for foreclosed property, Jeff Adams a real estate expert, says that it is wise to skip recently listed real estate property and focus on those that have been on the market for a while. This enables you to negotiate a lower price because the owner is probably at the point of accepting a decent price in order to do away with it. Pre-foreclosed property is property whose owner has been issued a Notice of Default (NOD) or whereby a Notice of Trustee Sale (NTS) has been issued to the auctioneer. The latter option should not be your main focus because such property could get off the market after successful negotiations between the lender and the borrower.

The next step would be to shortlist a few properties that fit the description of what you are looking for and using a deciding factor to settle on one. That could be the price, the location or other factors like renovation costs. Settling on property early enough helps to save time so as to bid on the property as soon as possible.

The final step is purchasing the real estate property you settle on and doing any necessary renovations before placing it back on the real estate market.


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