INVESTING IN FORECLOSED PROPERTIES

Outcome Desired

You must know your strategy going in before you take the first step toward finding and buying a property. Tactics that are appropriate for one strategy may be a mistake for another strategy. The less defined your end goal, the more likely you are to make costly mistakes along the way.

Goal Strategy Timeframe How it works
Generate long-term cash flow and build net worth Buy and hold Years Cash from rental while increasing net worth through appreciation. Long-term investment of capital.
Generate near-term income Fix and flip Months Add value through renovation and by fixing title, occupancy or financing issues. Short-term investment of capital.
Make a quick buck Wholesale flip Days or weeks Realize instant revenue by selling as-is. Very short-term investment of capital, 1-4 weeks.

Each has its advantages, cash requirements, risk level and required skill set. For example, if you follow a flipping strategy, you need to know how to sell. If you follow a holding strategy, you need to know how to rent and manage property. This is why Children’s H.E.L.P. recruited experts licensed and experienced in real estate transactions and finance.

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