Like so many Americans, my brother Mike was unemployed last year. Living in Elkhart Indiana the jobs were not plentiful so he and his wife, Maria, decided to combine their talents and create their own income. Maria, a wonderful realtor, found a foreclosed home in a nice area and bought it at the right price. After 60 days of paint/carpet and cleaning they sold their home within 3 weeks.
Mike made more income in 100 days than he would have made in a year and a half on his old job. I am so proud of them and thankfully today Mike has a great job… but in 2010 this was a huge blessing!
I have many years of experience in this field…both working with investors and doing it myself. Here are my keys to a successful flip:
My keys to a successful flip
- The profit is made the day you buy the home. It must be acquired at well below market value. Leave room for interest costs, unforeseen repairs, closing costs, legal costs and other surprises.
- Make sure the home has no unfixable objections: busy street, wet basement, no garage etc. In our current market conditions this is a killer. Buyers discount your property a ton for these things.
- Know why this home didn’t sell prior to the bank taking it. There is a reason! Find out what it is.
- Know your area. Take time looking at the current home inventory so you can compare a potential flip with what buyers are going to compare your property to.
- If you are not handy or do not have the time to do the repairs this may not be the time for you. Paying professionals to do this may eat all potential profit.
- Have a pre-determined plan if the house does not sell. This should never be a make or break deal. In this economy you must plan on worst case scenario.
- Don’t risk more than you can afford to lose. There are no sure things and this truly is a risk.
If you would like to view some properties in your area here is a list of bank owned properties. I would be happy to discuss the financing & strategy of these properties with you as well. We work with wonderful real estate professionals and would be happy to refer you one (like Maria Pendley @ mmpen@aol.com ).
Fannie Mae REO:http://www.homepath.com/
Bank of America REO:
http://bankofamerica.reo.com/search/propertysearch.aspx
Countrywide REO:
http://bankofamerica.reo.com/
HSBC REO:
http://www.us.hsbc.com/1/2/3/personal/home-loans/properties
OneWest Bank / IndyMac Bank REO:
http://apps.indymacbank.com/individuals/realestate/search.asp
Ocwen Financial REO:
http://www.ocwen.com/reo/home.cfm
JP Morgan Chase Bank REO:
http://mortgage.chase.com/pages/other/co_properties_landing.jsp
M&T Bank REO:
http://services.mandtbank.com/personal/bank_owned_prop.cfm
Wells Fargo REO:
http://www.pasreo.com/pasreo/public/propertySearch.do
Washington Mutual REO (WAMU):
http://www.wamuproperties.com
Wachovia REO:
http://reo.wachovia.com/
Fannie Mae REO:
http://www.mortgagecontent.net/reoSearchApplication/fanniemae/
Freddie Mac REO:
http://www.homesteps.com/hm01_1featuresearch.htm
HUD REO:
http://www.hud.gov/homes/index.cfm
HomeSales.gov also offers properties offered for sale by the government.
Coldwell Banker REO Division
Coldwell Banker REO Division
Citibank REO
http://www.citimortgage.com/Mortgage/Oreo/SearchListing.do
SBA Properties
http://app1.sba.gov/pfsales/dsp_search.html
FDIC Real Estate Owned
http://www4.fdic.gov/DRRORE/
BB&T REO (Branch Bank and Trust)
http://www.bbt.com/applications/specialassets/search.asp
Fifth Third Bank REO:
http://reo.53.com/
People’s Bank REO
http://www.peoples.com/im/cda/multi_elements/0,,1355,00.html
National City Mortgage REO
http://www.ncmcreo.com/
Taylor Bean REO
http://www.taylorbeanhomes.com/
Downey Savings & Loan
http://www.downeysavings.com/bank-owned-properties
David Pendley... 