Motivated Sellers

How To Find Foreclosure And Pre-Foreclosure Properties

2008-09-30T16:18:00.000-07:00

By Rick Saroukhanian

There are several basic methods that you can use to find foreclosures or preforeclosures:

1. Search Public Records for Foreclosures:

In various stages of the foreclosure process, notices are recorded with the County Clerk at your County Recorder’s Office. This information is public record and is available to anyone. Just visit your county’s office and you can search for a Notice of Default (NOD), Lis Pendens or for a Notice of Sale. The best part of searching public records yourself is that it is Free.

In addition, you’re likely to find newly posted properties that haven’t yet reached many of the online foreclosure data providers.

2. Look Online:

Performing online searches are quite a bit easier then going to the Clerk or Recorder’s Office, but you certainly won’t be the first to find out about a pending bank foreclosure.

Typically you’ll need to use an online listing service (for a directory of these services, see: Pre-Foreclosures), where you can either participate in a free trial or pay a weekly fee to view their listings. We recommend checking out the free trial offers so you can see which provider you feel best suits you. There are both national and regional foreclosure listing services, which provide Notice of Default, Notice of Trustee Sale and Lis Pendens data on properties in the foreclosure process. Many of these companies will provide information including name, address, loan amount owed, and additional loans outstanding, while a select few will even provide contact phone numbers .

Some of these companies will even provide listings of Bank REO Properties, but you can get that information for free online as well. Many of the large national and regional banks will list their REO properties on their websites.

Visit our directory of Banks with Free REO Listings on their websites

3. Search Local Newspapers:

Part of the requirement for filing a foreclosure is that the Notice of Sale be published in the Newspaper. If you search local papers and business journals, you can easily find notices for trustee sales in the Public Notice section.

Additional Sources for Finding Foreclosures

4. Find Asset Managers:

You can also find REO properties through Asset Management companies. Simply put, these companies help lenders dispose of assets. Many of these asset management companies will provide listings of the REO properties that they represent on their website.

5. Find Government Foreclosures:

Lastly, the government can also foreclose on properties. We’ve created a list of the various agencies that list government foreclosed properties.
For more information go to: www.RealEstateInvestorslife.com

Rick Sarouk is an active nationwide real estate investor and certified appraiser. He has been investing in foreclosure and preforeclosure real estate for the past 18 years. website: http://www.RealEstateInvestorslife.com

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How to Get a Good Mortgage

2008-09-23T18:36:00.000-07:00

By Rick Saroukhanian

Getting a good mortgage rate and terms at a reasonable cost can be tricky for the untrained consumer. I have been involved in the financing of real estate on two fronts, first as an appraiser who has appraised for lenders on over one 1000 mortgage loans and second as an investor who has applied for and refinanced over 100 loans in the past 15 years, so let me share some tips on how to get a good mortgage at the lowest possible cost. Visit my blog RealEstateInvestorsLife.com for more mortgage tips.

1. Know your credit report. One of the first things to do before considering a home purchase is to get a current copy of your credit report, and scrutinize it for errors. If you're applying for a no-documentation loan, for example, the credit report can be the most important piece of information available to your lender. Errors can be completely erased, along with out-of-date information that might weaken your credit score, but it takes time. Begin working on this project well in advance of applying for any mortgage loan. This way, reporting agencies have time to update your data.

2. Shop around. Get quotes from 3 lenders. You may be able to save yourself hundreds or even thousands of dollars by avoiding mortgages with high rates and/or high fees.

3. Always check the 10 year bond rate. All mortgage rates are connected to the 10 year bond rate. This rate can be found at any finance or stock website, such as Yahoo Finance, Google Finance, Ameritrade, Fidelity and many more. For example, if your mortgage broker quotes you 6% on a 30 year fixed today and tomorrow the 10 year bond rate dropps by .025 basis points you can be sure that the rate of 6% which you received yesterday has also dropped. But your mortgage broker or lender will not call you. Why should they? They make more money in selling you the higher 6% rate. You will have to call yourself and notify your broker that the 10 year bond rate has dropped and you expect your 6% rate to also drop accordingly to probably 5.75%-5.875%. Trust me once you make this kind of call, your mortgage broker will know that you are on top of the game.

4. Try to avoid and eliminate the middle men, "mortgage brokers, loan broker" and go directly to direct lenders or banks. Private loan brokers rarely are able to compete with direct lenders or banks on rates and they often charge excessive 3rd party closing costs or "junk fees', such as excessive processing fees, application fees, warehousing fees, documentation preparation fees and so forth. By going to a direct lender or a bank you can almost be certain that the closing costs related to your loan are always valid and no junk fees are applied.

5. Always haggle. A mortgage is just another consumer product. A few clever words can get a sweeter deal. Make your demands know upfront. Let them know that you would like to have your processing fees, which usually is about $330-$500 waived. Know your markets interest rate and try to pay the least amount of points. Try to pay less than 1 point on loan between $200,000-$1,000,000. On loans greater than 200,000 it is not uncommon to pay .075% points with no rebate at the back end. What is a rebate you ask? Mortgage brokers get an upfront fee called "points or Origination Fee" which is a percentage of your loan, but what most do not know is that mortgage brokers also get a back end fee, called a "rebate or yield spread" which is their markup over the par rate that they get from the source investor or lender, Assuming a 2 point markup, for example, the broker would quote 1 points on an 6.5% loan. If the current lender based par rate is 6% then you just paid the mortgage broker 1.5% total for your loan. The borrower pays for the rebate over time through the higher interest rate. By law in most states, such as California the mortgage broker must disclose the back end rebate fee to the consumer on the closing paperwork sent to the borrower, so check to see how much rebate or Yield Spread the broker is charging. The ideal situation would be 0 rebate and just negotiate on upfront points, this way you are certain you will receive the best available rate at the most reasonable cost, nothing is hidden or unknown.

6. Make sure your selected loan does not have a pre-payment penalty. Many people get what they consider a great loan and are not even aware that they have a prepayment penalty of 3-5 years. They find out when they try to refinance or sell off their existing loan that they would need to pay 6 months interest or more as a prepayment penalty. Lenders and Mortgage brokers also benefit in giving you a pre-payment penalty since they have you tied down with their loan product for 2-5 years not to mention higher compensation for them in a form of rebates if they can persuade you to get a loan with a pre-payment penalty. Do not fall for it. Never get a loan with a prepayment penalty.

7. Have the lender or broker write down all the costs associated with the loan, they usually are obligated by law to send you a "Good Faith Estimate" within 3 days of the initial loan application. All your fees have to be listed on the Good Faith Estimate, ask if the lender or broker will waive or reduce one or more of its fees or agree to a lower rate or fewer points. You'll want to make sure that the lender or broker is not agreeing to lower one fee while raising another or to lower the rate while raising points. There's no harm in asking lenders or brokers if they can give better terms than the original ones they quoted or than those you have found elsewhere.

Remember when buying or refinancing Real Estate, shop around to compare costs and terms, and to negotiate for the best deal. Your local newspaper and the Internet are good places to start shopping for a loan. You can usually find information both on interest rates and on points for several lenders. Since rates and points can change daily, you'll want to check your newspaper often when shopping for a home loan. But the newspaper does not list the fees, so be sure to ask the lenders about them.

Visit http://www.RealEstateInvestorsLife.com for more info. Rick Sarouk is an active nationwide real estate investor and certified appraiser. He has been investing in foreclosure and preforeclosure real estate for the past 18 years.

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Mortgage Loans Wholesale

2008-09-23T18:34:00.001-07:00

By Rick Saroukhanian

Mortgage Loans at wholesale prices; is it possible?

The answer is a definite yes. Just like any other product in the market, mortgage rates can be either retail or wholesale depending on how savvy and educated you are as a consumer. Before you start shopping for a mortgage, make sure you educate yourself about how a mortgage rate is determined and what are the costs associated with getting the lowest rate. Most Mortgage loans are sold at retail just like many products such as furniture, appliances, electronics and so forth? If you accept retail interest rates when refinancing or purchasing you could be overpaying by thousands of dollars upfront and many thousands of dollars every month for the life of the loan. You must understand the difference between retail and wholesale rates.

Mortgage Rates at Wholesale Vs Retail:

What is the difference between a wholesale mortgage rate vs. retail? Most borrowers are completely naïve and do not know that lenders and mortgage brokers mark up their interest rate for a commission, this markup is called a "Yield Spread or backend fee" within the industry. If your rate has been marked up by a Yield Spread and without your knowledge, then you have received a typical retail rate. So when you see ads in the TV, Radio or paper advertising 0 point or 0 cost loans then you can be assured that the rate associated with that loan will have a hefty Yield Spread attached to it. So in essence, you will be getting a very expensive retail loan. Lenders and mortgage brokers mark up interest rates because the wholesale lender pays them a bonus for charging you above market mortgage rates, this bonus is the Yield Spread Premium.

Example of a Yield Spread Premium when Applied to a Mortgage Loan:

Let's presume you want to refinance your home. Your balance is $200,000. Your local lender or mortgage broker tells you that you qualify for a 6.5% interest rate and charges you 1% for the origination fees or sometimes called points. What most people are not aware of is that the broker may also be getting .05 % from the wholesale lender in the form of a "Yield Spread Premium". In another words the real wholesale 0 cost of the loan or "Par Pricing" would be 6%. The end result is that your broker pockets $2,000 from the Yield Spread Premium along with the upfront cost of 1% which is another 2,000 and you get stuck paying retail mortgage rates for the lift of the loan. This in my opinion is a complete scam and should not be tolerated. So how do you protect yourself and make sure you are getting wholesale rates every time you apply for a loan?

Get Mortgage Loans At Wholesale:

The best way to avoid overpaying or paying Yield Spread Premiums is:

• Make sure that you tell your mortgage broker that you want "Par Pricing', which basically tells them that you know the game and will not tolerate back end fees.
• Review the "Good Faith Estimate', the cost breakdown of your loan, which all brokers must send to you within 3 days of the application, this is a federal law. They have to indicate, in small print mind you, the amount of Yield Spread Premium if any is charged. Make sure it states 0
• Most important, make sure you shop with at least 3-4 brokers and get the best available "Par Pricing" rates from each. You can do this simply from your coach at home by going to our site listed below and you will have 4 offers from different mortgage brokers all fighting for your business.

Happy hunting and the best of luck on your next purchase or refinance endeavor.

For more information about where to go to have mortgage brokers come to you and fight for your business go to http://www.RealEstateInvestorsLife.com

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Mortgage Loans Wholesale

2008-09-23T18:34:00.000-07:00

Probate Real Estate Investing

2008-09-23T18:24:00.000-07:00

By Rick Saroukhanian

Are you looking for a ready market of motivated home sellers who are often willing to sell at a deep discount — a market where you’ll have little to no competition at all?

If your answer is ‘who isn’t?’, then there’s a slew of real estate investors who want to tell you their secrets to buying probate real estate. According to many of them, probate real estate sales are easily the single most profitable area of real estate investing.

What Is Probate Real Estate?

When a person dies, their estate - all their worldly belongings - often goes into probate court, where a judge appoints an Executor to oversee its administration. It is the Executor’s job to make sure that the belongings are divided fairly and according to the decedent’s wishes. Depending on the state, the judge may also give the Executor different levels of power.

Why Are The Owners Of Probate Property So Motivated?

In many cases, when an heir inherits property, they inherit a burden. There are estate taxes to be paid, repairs that must be made, even, in some cases, a mortgage or second mortgage that must be kept up to date. Ready cash may be more important to them than any other factor.

Add in the fact that there are often multiple ‘owners’, and many of them may live far away, and you have a situation where selling the house is the best, sometimes only option to make sure that everyone gets their fair share of the estate.

Isn’t It Illegal To Sell Property That Is Being Probated?

It’s commonly assumed that sales of real estate in probate are extremely difficult, if not impossible. The truth is that, in most cases, the Executor has the power to make a decision to sell - as long as he has the agreement of all the heirs to the estate. In some cases, he or she may also need the permission of the court, but even if that happens, the agreement of all the heirs will usually be all the judge needs to approve a sale of real estate. Research the laws in your state for any requirements - for instance, some require that the property be listed through a licensed Realtor.

How Do I Find Properties In Probate?

Wills in probate are a matter of public record. A little research at your local courthouse will get you a list of all wills presented for probate. A little more legwork will turn up records of deeds to properties held in their name. It’s all a matter of a little research to find properties whose owners are eager to sell, and sell quickly.

How Do I Contact People About Buying Their Inherited Property?

Unlike foreclosure sales, where the owners are being forced to sell when they don’t want to, many heirs are eager to sell their property quickly so that they can use the cash realized. You can send out letters or postcards, make a phone call, and even pay a personal visit. Just keep in mind that you are offering a solution that they may not have considered - ready cash. In many cases, they’ll be happy to accept an offer for as little as 75% of the market value of the house just to get it sold quickly, and will do anything they need to do to help the sale go through.

Rick Sarouk is an active nationwide real estate investor and certified appraiser. He has been investing in foreclosure and preforeclosure real estate for the past 18 years. For more info http://www.RealEstateInvestorsLife.com

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Finding Motivated Sellers by RICK SAROUK

2007-09-28T14:05:00.000-07:00

Somewhere in between total luck and absolute sell-out hours chasing deals is where you should be in finding truly motivated sellers, or rather having them finding you. It's a weird coincidence that the smarter I work, the luckier I get finding great deals. Did you catch that? It's not always about how many hours you put into real estate and how hard you work at your marketing program that produces the best results which is finding great deals that puts money in your pocket and that's what real estate investing is all about.

Let me share with you some simple principles in marketing for the independent real estate investor. You may already be in tune with some of these, but let's all take a pulse-check here and make sure we're on the right track.

1) What Are You Hunting?

I'm asking what types of properties and real estate opportunities are you seeking? The more narrow your focus and marketing efforts can become to a target group, the greater success you will experience. If you are seeking wholesale opportunities, then you will not gain very much success putting out "I Buy House/Lease Option" bandit signs next to established neighborhoods. In addition, you will not gain a favorable response direct mailing to preforeclosure prospects if the primary weapon in your arsenal is cash-only deals with hard money lenders that don't go above 70% LTV.

The marketing medium you use and the message you accompany with it that hits the right target market turns sellers into motivated sellers. There simply is no generic marketing message and medium that is a "one-size-fits-all" approach in real estate.

2) Just How Much Money Can You Spend?

Now, we're talking about something that hits home real fast when it's about coming out of pocket with hard-earned money in the "hope" that it will come back to you in the form of truly motivated sellers. If you're first starting out in real estate investing then it's imperative that you have a short-term budget to work within so that you're not forgetting about paying for all the other necessities in life: food, shelter clothing!

You simply DO NOT have to have a large marketing budget to be effective to grow your RE business. One §.34 postcard netted me §8,400, so it's all about hitting your target market as explained in #1. However, be realistic about what monetary constraints you have and how to incrementally build your marketing program as you experience more and more success.

3) Track Your Results!

Oh, we miss the boat on this one so much. When you are incorporating bandit signs, direct mail, flyer campaigns, etc... it can start to get confusing where and if your success rate justifies the marketing mediums you are using. Tracking your responses and closures of deals is necessary so that you can identify areas that need to be tweaked or worked on. Most importantly though when you find out that great mailing list is really working or the flyers in a particular neighborhood is getting tremendous feedback....then go in for the kill! I mean when you are measuring success and can track it effectively it allows you in full financial confidence to justify increase in marketing expenditures for areas that are producing the results desired.

My hope is for you to realize that marketing to the real estate investor is the lifeblood of his/her business. Great deals rarely come knock on your door to find you. They find you when you have a marketing system implemented that is like a funnel prescreening sellers for motivation and directs them to then contact you immediately.

visit www.RealEstateInvestorsLife.com for more investot tools

Rick Sarouk is an active nationwide real estate investor and certified appraiser. He has been investing in foreclosure and preforeclosure real estate for the past 18 years.visit www.RealEstateInvestorsLife.com for more investot tools