We are very aware of the countless number of foreclosures that have impacted the American market over the last few years.This huge change in the real estate market has made buying new investment property more exciting than ever.  As a result of so many foreclosures, many banks have been forced to buy these properties back at the Sheriff sale.

But what do experienced real estate investors look for when they are actively pursuing bank owned homes?

1.  Knowing The Most Important Number In Real Estate Investing

There are several key factors for the experienced real estate investor to consider when purchasing bank owned properties.Experienced real estate investors know that the “top number” is the most important factor when evaluating new investment opportuntities.

The number is also called the property’s “after repair condition”.This is the selling price after you have completed the renovation.

Property investors must know what similiar properties are selling for BEFORE they can put together an offer that makes good investment sense.For example, if 2,000 square foot houses are selling for 0/square foot, experience investors will make initial offers around /square foot.  In today’s market, you can certainly make your first offer at or around $.50/$1.00 (that’s fifty cents on the dollar).

With so many bank owned homes for sale, experienced real estate investors are in the driver’s seat.Develop a search criteria and go after these investment properties in a methodical, workman like approach.

Make rock solid offers and don’t hesistate to walk away from the deal.Don’t ever forget that we’re in a buyers’ market.The bank is a very motivated seller and wants to get rid of the the property.Take advantage of this situation and always be willing to walk away from the deal if the investment doesn’t make sense.

2.  Inspect Several Bank Owned Homes

Usually, bank owned homes are listed with a realtor.  So gaining access to these available properties is very easy.  Experienced property investors maximize their search efforts by scheduling multiple property showings in a given time slot.

For example, you should schedule showings for multiple bank owned properties, not just one.Since these properties are owned by the bank, they’re all vacant and easily accessible to all.

Understand that as a property investor, you will be expected to buy a bank owned home in “as is” condition.  This means that the bank in most cases will not be making any repairs.  So make sure you can handle the renovation project.  You need to need to know the numbers here too.

Experienced property investors have a firm grasp on renovation project costs.Make sure you know the numbers here too. 

It’s just a good idea to overestimate your project expenses by at least 10%.When your renovation projects have that needed extra cash on hand, unexpected surprises are not that big of a deal.When an investor can write a check, he doesn’t really have a problem.  Just make sure you have adequate cash reserves on hand.

3.  Pay Close Attention To The Bank’s Paperwork

Because so many banks are large corporations, you will be dealing with a large amount of paperwork when buying these investment properties.Carefully review every form and document that you are required to sign.You will need to complete the purchase agreement, disclosures and many other real estate documents.

Fill them out correctly.  Check with the listing agent and make sure all required paperwork is completed properly.If you fail to complete the required paperwork properly the first time
It will delay the bank’s response to your offer unneccessarily.In many cases, this may result in weeks of wasted time.Make sure you pay close attention to the details during this part of the process.

There are many different ways to acquire investment property for the experienced real estate investor.

Make certain that you have more than one acquisiton method.Experienced property investors know that you need multiple lead generators in place at all times. 

With an over supply of bank owned homes on the market, this buying opportunity will be with us for many years to come. 

I hope these new ideas help you in your business.  There are many effective real estate investing techniques, this is just one of them.