We have moved to a new address at
http://theinvestmentpropertyexperts.com

Please click on the above link if the site doesn't redirect you momentarily.
Thank you

Friday, June 26, 2009

Renters Hit By Foreclosure Market

For an interesting article in today's Washington Independent, click here. It talks about the Phoenix market and how renters are hit by the foreclosure crisis.

As owners/investors land in a bind and either are forced into foreclosure or a short sale, they need to do the right thing when it comes to their tenants.

WHAT TO DO?

You’ve ridden your investment property as long as you can and have determined that it just doesn’t make sense to keep making the payments.

The reasons are probably one of the following:

1. You don’t have enough money to keep making payments (due to job loss, other major expenses, etc.),

2. You feel so insecure about your current source of income that you need to pay on only those things that would be left if/when you DO lose that income,

3. Your rental property is so upside-down and/or market rent is so much less than your mortgage payment that it is a poor financial decision to keep throwing money at it, or

4. Some or all of the above.

You have a few options. They include working things out with your lender to keep the property under freshly negotiated terms that work for you, short-selling the property, or letting the property go into foreclosure. The latter will produce the worst effect on your credit.

Despite what you may have heard about lenders working only with borrowers in owner-occupied scenarios, lenders WILL work hard to create a workable outcome for investors. If you would like to keep your property but need relief on payments or past-due balances you should discuss this with your lender’s loss mitigation department. You’ll be surprised at how receptive they are to talking productively.

If you cannot or don’t want to keep the property, you should attempt to short-sell the property before the bank forecloses. The lenders are very willing to work with you to do this (much more willing than six months ago), because it provides them with a much better outcome than having to foreclose on the property and pay the costs of a trustee sale. Find a licensed real estate agent who has experience in this area.


DON'T WAIT UNTIL PAYMENTS ARE MISSED

These first two options can happen prior to missing any payments on your loan. In most cases, borrowers don’t start these negotiations until they have missed one or more payments—giving them less time to reach an agreement with the lender. In either case, keep open lines of communication with the lender letting them know of your intentions and current situation.

Have questions or need an experienced property management company to assist you? Contact HomeLovers today at http://www.homelovers.com/.

Like this article? Subscribe now to receive new postings via email or RSS.

Monday, June 1, 2009

Getting a Great Deal on an Arizona Foreclosure

There is a new feeding frenzy developing in the Arizona housing market. The buzz words are auction, foreclosure, short sale, REO, etc., but the common theme is “deal”.

During the run up of 2004-2006, people were pretty much buying anything with a "for sale" sign and we all know how that story ended. Today I am seeing a similar lack of judgment with people rushing to buy any property that looks cheap.

I was on a great dive trip over Memorial Day weekend. Part of a dive trip is being on a small boat with a group of total strangers. Without fail, somebody on the boat reminds me that while anybody CAN wear a tiny string bikini or a Speedo, most people shouldn’t. Even if they found a store that was handing them out for free.

Don’t get me wrong... I love a deal as much as the next guy, as long as it is a deal on the right property. The wrong rental property, even at an amazing price, will never deliver an incredible result in terms of revenue. Just like that free Speedo, it may not be the best fit.

Even the cheapest foreclosure bargain can be an expensive investment mistake.

Before you run out shopping, do your homework (see a related article on "Choosing the Right Property"). Get clear about the long-term plan for your investments. Know what you expect the investment to do for you over time. Decide what type of tenants you want to attract. Then, make sure you understand what type of property will meet all those requirements.
If you don’t do your homework on the front end, your chances of ending up with the perfect property are remote.

We get calls from hundreds of investors looking for property management every month. The worse a property is, the more difficult it is to manage, so many of the people who call are tired of the hassle and regretting the purchase. Over 80% of the homes people bring to us are homes we would have never purchased or sold as an investment.

Having said that, there are incredible deals in every price range, so there is no reason to settle for the wrong home.

With the right tools, it is easy to crunch the inventory of available properties down to a short list of homes that will make a truly great investment. Once your list of potential purchases is limited to the great investments, you can shop for the best deal without compromising long term ROI. If you know how the planning, building, and managing phases of your investment impact each other and take action accordingly, you will be way ahead of the masses that are getting a great “deal” on bad investments.

You will also avoid being the investor equivalent of the big guy on the boat who really thinks his bright yellow Speedo makes him a sexy supermodel.