Jeff Adams: Earning from Foreclosures

One keeps hearing about news of foreclosure from someone or the other all the time. It’s almost become like an everyday thing. This could go both in favor and against the investor. It entirely depends on his or her way of working.

At the time a money lender is unable to recover his or her loan from the home-owner, the money lender takes ownership of the house. The home-owner is given a time limit to repay the loan after which his or her house is repositioned. Most of the times the owners don’t pay due to issues such as divorce, migration etc.

These properties are sold off in loss most of the times. At times, the loss is major. However, since the money lenders or at times banks are already putting up with huge losses due to non-payment of installments they have no choice but to sell it away to make up for it.

The Brighter Side of Things
Losses are not always bad. At times, you need losses to make profit. After all, someone else’s loss is always your gain. Thus, if the situation is in your favor with regards to the economy as well as the industry, then use it. Exploit it to the fullest. Hit on every opportunity. Applying a little logic to whatever’s happening will place you in an advantageous situation.

When talking of hitting on every opportunity, do not leave out the interest rate part. Interest rate is your chance of earning a whole lot of money. Selling of mortgaged property at high prices will change the economic situation of the real estate market. Owing to which the interest rate will automatically rise. Hence, when selling or renting out properties, or even lending loans, do not leave out interest. It is extremely important.

These are crucial factors and the very elements responsible for a game change. These factors should be kept in mind when buying, selling and renting properties. However, when setting an interest on a particular amount, be very careful. Do not be high-handed and set an explicit percentage as interest rate. It will definitely back fire on you.

As far as interest rate is concerned, you’ll have to be modest and comply with the standard rates. The interest does not have to be exactly standard. It could be 1 or 2 % higher. That will work wonders for you.

You ought to cleverly change the market on the sly, you yourself making huge profits in the bid. It will also increase the number of loan applicants at banks and financial institutions. Since, there will be more demand for property that there already is.

Obviously, the entire economy will boost if the supply does not match the demand. Like we all know, as far as real estate is concerned, the supply never complies with the demand. There is always more demand then there is supply.

When the economic situation is like this, it is in favor of the investors. This is the time to invest and make money out of it. Since, the rates or on a constant increase, a quick investment and a sell off at saturation point will do you great benefits.

Apart from benefiting the investors, the industry will also create a large number of jobs for budding aspirants. Apart from that, a large number of buyers will splutter into the market. This is the investors’ time to make money.

There is hardly any chance that the investors will run into losses in a scenario like this. It is almost like a win-win situation for the investor. The chances that he or she will fall flat are extremely minute.

Things to Remember
Yes, it is true that the situation looks perfect for investing. However there are a few things one needs to look into before taking the plunge. There are things that you need to look into before investing.

  • Study the situation correctly and minutely before investing
  • Never get attracted towards the money, play smart
  • However, too much studying of the situation and you might lose out on a good opportunity
  • Keep away from Hedge investors, they will make you suffer from losses
  • At the same time, keep away from co-investors, remember they are competitors
  • Be very careful whilst investing, one wrong move and you might have to shut down
  • Sometimes, things look like falling apart, get a hold in time. Refrain from panicking
  • Create beneficial situations on your own, don’t whimper around hoping that the situation will create itself.

These elements have always been beneficial for me. I am sure they will also work out similarly for you. A humungous amount of money flows in and out of the real estate market every year. Use this money, play with it and earn benefits out of it.

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