Commonly Asked Questions About Real Estate Investing - Pt. I

Copyright (c) 2010 Jack Bosch

Now that you have begun to get excited about the real estate investment opportunities that are out there for you, chances are you may have some questions that you're dying to have answered. Here are a few of the most commonly asked questions and their answers:

How do I know if my state offers struck off properties?

Well, there are programs out there with state-by-state guides to show you which states offer them. The easiest way to do this without programs is to decide where you want to invest, like your own state, and call the government offices to ask them directly. Ask them what their foreclosure process is. They will tell you! Lots of people don't use this option simply because they are unsure of where to begin. Don't let your lack of knowledge prevent you from acting on it.

What is the cost of foreclosing?

The cost of foreclosing depends on whether or not you can get a treasurer's deed. In Arizona, for example, it used to be that you could wait for five years before getting a treasurer's deed. Now, they have changed and that you can wait for three years when you go to a judicial foreclosure. Typically, you can get that done with $750. Other states vary, and if you live in a state that allows you to do it with a treasurer's deed, they ask for around $200-$400. Some states might be unreasonably high, most of the time you configure on these quotes. Look for lower-priced properties with higher value in order to get the best money out of your foreclosure costs.

Do you use properties as collateral to purchase other types of properties?

This type of question generally comes when an investor does not have his or her own personal collateral to put up against the purchase of future properties. Sometimes this is not necessary. You can go on Craigslist to find properties or even sell them. You can also go to the bank and put a certain amount of collateral next to that and therefore you do not have to ask for the same amount of money. You can get up to 80% financing deal on a commercial piece of property if you already have other land as collateral.

How hard is it to foreclose on a tax lien and do you need a lawyer to assist you?

In most states, if you have the concept of a trustee sale, you can have the court decide on it and make a court decision, and then it will go to a trustee sale. You will be trying to sell the property for enough of the money to get your money back and then you can also bid yourself. If you want the property, you can bid as high as you want because the money will eventually go to you anyway. Typically, the trustee sales are done by an attorney. You do want to have an attorney participate in that process which is why it costs $750.