Some first time U.S. real estate investors believe that they are able to purchase a foreclosure quickly, flip it and sell the property for a rapid profit.
At any given time, you can watch an abundance of infomercials that inform you of how you can become rich fast by investing into foreclosures; all of which contain the “secret” to success. Truth is, anyone who works in the real estate industry can inform anyone with these pipe dreams that you have to have cash to make cash. the reason for this is that you should always be prepared when dealing with foreclosures. Some are in such bad shape that financial institutions will not finance the deal, and that leaves you, the investor, having to use cash for the transaction.
Realistically, most foreclosures need renovations and property care before investors can make any type of “real” money on them. As a first time U.S. real estate investor, you will quickly discover that it’s rare to simply find a foreclosure that does not require a lot of work. This is why investors should search for foreclosures in a realistic manner and with an open mind. Searching for a foreclosure should be focused on how much money we, the investors, are willing to place into the foreclosed property.
This being said, don’t be discouraged!!