Real estate investment can be a life changing career to many investors. Among the various types of investments like selling houses, flipping homes, renting properties etc., Wholesaling is also an effective method of investment. In all other investments you need a considerable amount of money, time and work to gain profit.
For example, buying and selling homes requires the huge investment and you have to find a buyer. Flipping homes needs lot of hard work like repairing and renovating the houses. Rental properties will generate cash flow income on monthly basis and you have to do proper maintenance of the property throughout the life time.
Wholesale REO properties for sale California
But wholesaling is entirely different from the other modes of real estate investments. How? You only need little money or invest even without it if you plan it properly. You can find the REO or foreclosure property and assign the contract to another buyer who can close on it. You can get money from the deal easily without owning any property in your name. Cool, isn’t it?
But is it easy to do it? No! You have to struggle and write many offers to find the REO or foreclosure properties. Even after finding one, you can’t expect a huge discount from the price. Many investors often think that they can buy a foreclosure for a great discount price at an auction and sell it for more prices. This assumption is wrong as the banks won’t sell the foreclosure properties in that way.
The Real estate owned or REO properties are nothing but the houses owned by the individuals who has a mortgage payment debt to pay to the bank or other lending institutions. So, the bank will be selling the house at an auction for price which is little bit lower than the market value. Banks will be selling the properties in as is condition and you have to wholesale it to the buyer.
Remember the fact that the bank will not be offering any discount for even repairs and renovations. Many wholesalers often ask the lender to deduct some amount for fix ups and renovations. This will not happen in many cases and you have to bear your own repair expenses.
Inspect the property before buying it in auction
The drawback of buying the wholesale REO properties for sale in California at an auction is the banks or lender will demand you to pay the money on the same day. If you buy the property in a hurry then you may not inspect it properly and find out if there are flaws in the home. You have to check whether the house is structurally good and its condition is fair enough for sale. If not then you cannot convince the buyer easily. The next important thing is location of the property which decided whether it will sell quickly or not.
To find the REO properties log on to the local real estate database and search of an ideal properties. Contact some bank agent who works on REO or foreclosure properties. Because some banks won’t let the wholesalers to directly buy the property. They will have some agent who will deal with the sale of the property. This can also be an advantage on your side since you can easily avoid paying the real estate agents.