biggest foolish assumption I make in this book is that you own the home you live in. You’ve been involved in at least one closing and signed the documents that the closing agent passed around. When you own a home, you instantly become a real estate investor. You begin to grasp the value of real estate as an investment. You gain firsthand knowledge of the benefits of owning a home, understand the challenges of maintaining it, and take on the responsibility of making mortgage payments. You can empathize with homeowners who are about to lose their homes in foreclosure.
If you’re not a homeowner, sell this book, and put the proceeds toward a down payment on a house. If you live in the Detroit metropolitan area, contact me, and I’ll find the perfect house for you and your family. I’ll even give you credit on the purchase of the book. Or stop by the office, and I’ll personally sign your copy. After you’ve purchased a house and have lived in it for a few months, pick up the book. I’ll be waiting for you.
Other foolish assumptions I make include, but aren’t limited to, the following:
You’re committed to success. Investing in foreclosures is hard work and requires sticktoitism (pronounced stik-to-it-izm) — a word I’ve been using since the 1970s to describe the determination and dogged perseverance required to build wealth in real estate. I could use stick-to-itiveness, which happens to appear in the dictionary, but I like my word better.
You can talk to people. You don’t need to be a social butterfly (although that helps), but you do need to be able to network, ask questions, and haggle with people. If you don’t have some basic people skills, you should team up with someone who does. Effective word-of-mouth networking leads to the best opportunities, and in almost every situation, you’ll need to talk with homeowners, county clerks, sheriffs, lenders, and a host of others involved in the foreclosure process.
You’re dedicated to developing mutually beneficial solutions. I hate to see “investors” ripping off homeowners, and I’d really hate to see anyone use the information in this book to take advantage of distressed homeowners. You can earn plenty of money investing in foreclosures by acting with integrity and presenting reasonable solutions that meet the needs of all parties involved.
You’re able to treat foreclosure investing as business. Understand that you’re not the cause of the homeowners’ distress. More than likely, you can’t solve their problems. Very likely, many others have tried to help the homeowners solve the root cause of the problem (and failed) before you came along. What you can offer are truth and useful information. You must be empathetic without jumping in to save a drowning family that may drag you under both financially and emotionally.
Keep in mind that a real problem is something that money can’t fix, such as an untreatable illness or a death in the family. Most families, if they choose to, can move on after experiencing a financial calamity. Foreclosure isn’t the end of the world, although at the time, homeowners may perceive it to be.
Icons Used in This Book
Throughout this book, I’ve sprinkled icons in the margins to cue you in on different types of information that call out for your attention. Here are the icons you’ll see and a brief description of each.
Beyond the Book
In addition to the priceless information and guidance you’ll find in the nearly 400 pages of this book, you can access the Foreclosure Investing For Dummies Cheat Sheet online. Just go to www.dummies.com, and enter “Foreclosure Investing For Dummies Cheat Sheet” in the search box. The Cheat Sheet includes a complete checklist of everything you should have before you bid or make an offer on a foreclosure property, step-by-step instructions for buying properties in pre-foreclosure, step-by-step instructions for buying properties at foreclosure auctions, a list of foreclosure auction websites, and a list of the ten most common mistakes to avoid when investing in foreclosure properties.
Where to Go from Here
Foreclosure Investing For Dummies is constructed in a way that’s similar to the foreclosure process itself. It presents you with opportunities and with information to capitalize on those opportunities in three key entry points in the foreclosure process: pre-foreclosure, foreclosure, and post-foreclosure.
For a quick course on foreclosure investing, check out Chapter 1, which provides an overview of the foreclosure process along with some tidbits on how to profit from the various stages of the process. Skip to Chapter 3, where I guide you in selecting your preferred entry point. The chapters in Part 2 are indispensable in preparing you for a successful investment venture. If you choose to invest in pre-foreclosures, skip to Part 3, were you discover how to research properties and deal directly with homeowners. Part 3 also contains a chapter (Chapter 8) that’s essential for all foreclosure investors: properly researching a property. If you’re interested in purchasing properties at auction or after they’ve been repossessed, Part 4 provides all the information you need to know. And when you’re ready to cash out on your investment, skip to Part 5.
Part 1
Prepping Yourself for Foreclosure Success
IN THIS PART …
Get up to speed on finding, researching, bidding on, buying, and selling foreclosure properties at all stages of the foreclosure process, from pre-foreclosure to post-sale.
Tell the difference between judicial and nonjudicial foreclosure, and figure out which approach your state follows.
Identify the different stages of the foreclosure process, and discover the benefits and drawbacks of opportunities for acquiring properties at each stage.
Find profitable opportunities
