OfflineAuthor: Real Estate Expert
Bpo Real Estate Definition
Many beginning real estate investors get started by flipping real estate to make quick cash. If you would like to make more money by investing in real estate, you need to know a few essentials. Bpo Real Estate Definition
What is the definition of real estate flipping?
Simple definition: Buying property and reselling quickly, hopefully for a great profit. Usually, people think of flipping houses, or the buying and selling of a home fast, as the only way to make money flipping real estate. However, some investors specialize in other types of real estate such as land or strip centers.
Some confusion arises over the process of making money flipping property. People who specialize in finding bargain real estate, obtain a purchase contract, and then sell the contract before taking title to the property are known as "Bird Dogs." These beginning real estate investors get started with no money down by:
- Finding a seller under stress with a bargain property
- Securing a sales contract
- Selling their contract for roughly $500 to $5,000 to a seasoned real estate investor
Isn't real estate flipping illegal?
Flipping real estate isn't illegal. However, many unscrupulous investors committed mortgage fraud to make fast money. Some of these investors, working with mortgage brokers and appraisers, resold houses to unqualified buyers inflating the property value and home buyer's qualifications. Often these home purchases had no money or little money down. When these new home owners defaulted on the mortgage payment, the mortgage lenders lost money because the house wasn't worth the inflated purchase price. Bpo Real Estate Definition
To avoid legal problems in real estate flipping, don't commit mortgage fraud.
To make money real estate flipping:
1. Prepare your financing so you can close on a deal quickly.
2. Learn your market so you know what makes a good deal.
3. Find a bargain property owned by a seller under stress to sell.
4. Secure a purchase contract in your favor.
5. During escrow, plan your selling actions.
6. Close on the property on time.
7. Immediately set your selling plan into action. If the property needs fixing, be prepared to get this done right away.
8. Market your property to your target market. Don't just list the property and hope for the best.
9. Find a qualified buyer. Have a loan officer check to make sure your buyer meets all the mortgage requirements.
10. Stay legal. Don't use an inflated appraisal. Don't gift your buyer the down payment. Don't help your buyer create false W2s, write phony credit letters, or prepare any false documents. You can pay many of your buyer's closing costs to make the purchase easier.
You can make money flipping real estate. Buy low, sell for full-market value, avoid mortgage fraud, and enjoy your profits! Bpo Real Estate Definition
Article Source: http://www.articlesbase.com/real-estate-articles/bpo-real-estate-definition-flipping-real-estate-3478527.html
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Tomas is a BPO expert in our home town. He is contracted by the 4 major BPO companies in which the banks go to before they foreclose on a house.
I highly recommend that you find a real estate broker in your area who does this. Even if they do not do a lot of the BPO's, they are still getting a list of availble houses in your area!
Having the ability to know what is about to hit the market gives you a great competitive advantage in 2 ways (I'm sure Tomas has more than 2!):
1) Inventory: You know what is about to hit the market. I have never seen Tomas use this information in an unethical manner; however, it is still good to know what is coming out, the price ranges, neighborhoods, etc.
2) Market Research: If your broker is doing this month after month after month, he/she truly has a better understanding of that market over all others. Tomas has the ability to see where the market is going before it comes...he's like a fortune teller! A really cute one at that! OK, what's the rule of supply and demand? When supply goes up, prices come down, right? When you can track the trends of BPO's and Foreclosures in your area then you will know when prices are about to go up and (fortunately) when prices are heading south! We like to buy when the prices are going up (for buy/hold strategies when we find great deals), but we prefer to buy even more when the prices go down!
I always tell my clients (as a financial advisor), when the market goes down, that's like getting a pair of shoes on SALE!! Instead of buying one, why not buy two or three or fifteen!!! Or another way: if you are ready to throw a brick through my window, make sure there is a hefty check attached to it! Woo-Hoo!
Disclaimer: I am only posting the information I've heard Tomas say over and over about BPO's. He can go into much more detail, if you have further questions. Feel free to DM/IM/PM/what ever that DG symbol is to talk to him!
Hope this helps! Had a great time at the EDGE event! If you are reading this, you HAVE to go next year...NO EXCUSES!
Jeri Berry
Tom and Jeri
www.TuCasaInvestors.com
www.TuCasaRealtyllc.com