How To Become A Bulk REO Investor
The recession in the U.S. economy has resulted in more foreclosures than experienced by any other generation of Americans. But smart real estate investors are turning these ‘lemons’ into ‘lemonade’ in an incredibly profitable new way.
The real estate investing strategy du jour is called ‘Bulk REO Investing‘ and is a real monster.
Take a just a minute to consider the basics of this highly profitable business.
You can’t understand Bulk REO Investments without understanding the process of foreclosure.
As a borrower becomes increasingly behind in his mortgage, the lender regularly calls and writes the borrower with default warnings and threats. The official foreclosure proceedings begin subsequently, as directed by the lender. ‘Pre foreclosure’ is the name given to the time between implementation of the foreclosure proceedings and the public auction.
The defaulted property is ultimately auctioned, thus completing the foreclosure process. Ownership of the property is returned to the lender if the property is not sold at auction. The designation of ‘REO’ (Real Estate Owned) is then attached to the foreclosed property.
REO properties are usually listed for sale with local real estate agents. Yet with increasing frequency, REO properties are being sold for pennies or dimes on the dollar. But the price of receiving such great pricing is the need to purchase multiple REO properties (a ‘package’) rather than individual properties.
Qualified real estate investors are increasingly finding once-in-a-lifetime opportunities in these REO packages. One of the best ways to take advantage of Bulk REO Investing opportunities is to partner with a well-regarded source of funding. Some sources of funding for these transactions are: personal funds, hard money lenders, commercial lenders and non-conventional sources such as private investors and hedge funds. Additionally, one man is becoming very well known in the field of bulk REO investing, and his name is Sal Buscemi of Dandrew Capital Partners, a New-York based hedge fund.
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