Detroit Area Real Estate - Canton | Plymouth | Northville | Livonia - Community News » buying foreclosures

Canton, Mi home buyers find bargains in pre foreclosure houses.

alsted — Thu, 26 Jun 2008 22:45:44 +0000

Buy that sinking house before it totally submerges into the foreclosure process! That’s our advice to home buyers looking for homes in Canton and Plymouth, Michigan.

Home buyers usually ask us to search specifically for foreclosed houses thinking this is where the best bargains are.

Savvy buyers look for houses that are in danger of foreclosure but have not gone into that process yet

Understanding the stages of the foreclosure process can help you gauge when to buy. Once foreclosed, the price you may get on a house may not be the best. The reasons are varied but usually have to do with rules and regulations concerning each stage of the foreclosure process.

You can find great deals on homes at any stage in the foreclosure process – preforeclosure, the foreclosure auction, or post-auction (from banks and investors) – but it’s often a case of the early bird getting the juiciest worm. By purchasing the property directly from the homeowner in preforeclosure, you reap several benefits, including the following:

• A lower price, because you’re not competing against other investors in open bidding.

• An opportunity to inspect the home, because you can make your offer conditional upon the home passing inspection. (When you buy at auction, the homeowners may not let you inside prior to the auction to inspect the home.)

• Assurance that you are buying the home and not just a mortgage. When you bid at a foreclosure auction, you are buying a mortgage, not a home. If you bid on a second mortgage by mistake and do not also buy the first mortgage, you could lose your stake in the home and any money you paid for that mortgage. Buying directly from the homeowner assures you that you are buying the home.

• Security that you won’t lose the home in redemption. In Michigan homeowners have the right to redeem their home (buy it back) after the sale. You could lose it to the homeowners or to another investor (working with the homeowners) even if you win the auction. If the homeowners sell to you, they have no right to redeem.

You can find homes in preforeclosure by reading the foreclosure notices every week they are published. By law, foreclosure notices must be published for a number of consecutive weeks prior to the sale in a local newspaper or county legal news publication. Check with your county’s register of deeds to find out in which publication(s) the foreclosure notices appear, and then subscribe to at least one of those publications.

To reduce the competition even more, you may want to consider learning about preforeclosures even earlier in the process – before the foreclosure notice or notice of default is published and becomes public knowledge. To obtain early notice, try the following techniques:

• Network with attorneys who work with distressed homeowners in bankruptcy, foreclosure, divorce, and probate. These attorneys often have to help their clients liquidate assets.

• Network with other real estate and mortgage professionals.

• Tell everyone you know that you are an investor who purchases homes for cash. Better yet, create your own business card and give it to everyone you meet. People will know they can turn to you if they ever need to sell in a hurry.

• Treat distressed homeowners with compassion and a sense of fairness and do a good job rehabbing the home. By treating people right and doing good work, you earn a reputation that speaks well of you. People who need to sell their home in a hurry will come to you rather than another investor who has a less stellar reputation.

• Advertise that you buy houses for cash. You can post an ad in the local newspaper and hang fliers and signs around town (assuming this is acceptable in the area where you want to buy homes). Before you advertise, however, make sure you have the financing and resources in place to handle several properties at once.

Remember to choose your investments wisely. You won’t get every house you see, nor should you want every house you see. You can afford to be picky and patient – wait for the right opportunity to come your way. And do your homework to make sure it is the right opportunity for you.

For more information ask Ralph R. Roberts, GRI, CRS. An experienced real estate investor and consultant and the author of Foreclosure Investing For Dummies (John Wiley & Sons).

Because of our marketing and longevity in the Detroit western suburbs many homeowners contact us us for advice when they reach the early stages of foreclosure. Our goal is to help people faced with foreclosure by strategizing how to get their home sold with as little damage to their finances as possible. This usually requires a short sale or some other avenue that involves bank refinance or work out. We maintain a database of these houses and with seller permission we have sold several homes before they even reached the market. If you are interested in obtaining a list of these homes call us at 734-459-2600 and ask for the "PreForeclosed Hot List".

Positive home sale factors the media ignore.

alsted — Mon, 05 May 2008 14:59:37 +0000

Thumbs up for all the positive things about home sales in Detroit, Michigan suburbs that are not getting reported by the media!

It is true that home sales are at an all time low here in Canton, Plymouth, Northville, Livonia and pretty much all of southeastern Michigan. The media remind us of foreclosures, short sales, and the slowdown in home sales in general almost daily. The mantra is mind numbing, especially if you are a home buyer, seller, or in the real estate sales profession like Noel and I are.

I have always been taught to look on the positive side though and thought I would outline some of the reasons for optimism concerning the present state of affairs in the real estate market. I gathered these statistics concerning home sales in America. Remember these are for the country as a whole but we can expect to see similar results in our market. Also remember our home sale slowdown occurred a year or two prior to the rest of the country. This was due to the slowdown of the Michigan economy that the country did not experience. In fact the slowdown of home sales in the rest of the country is due mainly to the price bubble that occurred due to speculation and easy money as opposed to job losses for example.

The Reasons for Optimism:

During the 2005-2007 correction:

Median household income grew by 5%

> 4 Million jobs were created

> 2 Million Legal Immigrations (4 Million IRS I-10 status)

> U.S. Population grew by 5 Million people

> House prices fell, so affordability is up

> 3 Million Family formations

> Retiring boomers abated sales or purchases

AND — Why an up-turn in late 2008 and early 2009 is likely and by 2010 solid:

> Pent up demand from the correction will work off the inventory

> U.S. population growth by another 5-7 Million people to a total of 315 Million by 2010

> 1 Million + Legal immigrants/year

> X Generation 30 Million

> Y Generation 70 Million

Estimates are that about 100 Million people are growing into home buying age; youngest 20+, oldest early 30′s. It’s estimated that only 5% own a home now.

By 2010, we will likely be in a balanced market. Enough inventory to meet demand; but not at the point where there are not enough listings.

Builders will start to replenish new home supplies as there will be a demand for 129 Million housing units vs. 127 Million now built.

AND — Why is now a good time for buyers to buy?

> 30-year fixed-rate mortgages at 6% on average, they are down from 6.3% a year ago — lower rates mean buyers can afford more

> As a forward-looking factor, mortgage interest rates continue to hover just above the 40-year lows — there is mortgage money available at some of the lowest rates in history

> Excellent homes-for-sale selection, both new and resale

> Great value – homes priced to sell

> More affordable housing and lower monthly payments

> Owning a home offers good tax benefits

> Homes are still a great investment and are increasing in value in most markets

> Build incentives and promotions available

Yes there are reasons to celebrate in what seems to be a down market. Keep in mind these statistics are for the country as a whole but here in the Detroit market we are experiencing a significant increase in sales activity right now. Could it be that we may recover faster than the country as a whole? As I mentioned, we went into a slump at least a year or two ahead of the country. Maybe it’s our turn to lead the country out of this home sale slowdown.

Here’s more evidence of this. Our partner website for searching homes, www.bestmichiganhouses.com , has been registering record traffic. What’s more interesting is the people that have been coming to this site are coming back in record numbers on a daily basis. The return is probably because the site is so user friendly, but it also seems there is so much more interest in finding a home. People are requesting more from the site than they have in the past few months.

Now you may be asking yourself how to take advantage of the surge in home buying interest that is occurring. Our website www.thebittingerteam.com is designed to be a resource site for people interested in buying, selling, and investing in real estate. Although we do have information on our team and how we work, the main function of the site is to provide resources to you the consumer to help you understand all aspects of the real estate market.

Here is an example of how the site can help you. The two buzzwords you hear in the real estate market today are "Foreclosures" and "Short Sales".

The tab labeled "Foreclosure Help" takes you to pages that explain in detail how foreclosures work, how they are different in Michigan as opposed to the other states, online resources for further information, and a wealth of other pages that are being added to further your knowledge of the Foreclosure market.

Similarly the "Short Sale Help" tab takes you to pages concerning Short Sale FAQ’s, the effect short sales have on appraisals, helpful hints to see if you qualify for a short sale, and a host of additional information on the process and what it may mean to you as a buyer or seller.

There are lots of reasons to buy a house right now. With interest rates and house prices so low there is no reason to wait. If you currently own a home and it fulfills all your needs then the best advice is to stay where you are. If however you have been contemplating moving because the home no longer fits your needs, an upgrade to a house that does may make a lot of sense. While you may take a financial hit on your current house you could stand to make a windfall on a bargain you will buy to replace it.

If you would like advice on your situation don’t hesitate to call us at 734-459-2600. We can help you over the phone to decide which way is best for you and your family.

Look before you leap …. or Flip a House!

alsted — Tue, 29 Apr 2008 00:03:04 +0000

If you leap right in to house flipping will you make big money or loose change?

How you plan a house flip makes all the difference.

There are lots of opportunities to make money on house flips in Canton, Plymouth, Northville and many more of the surrounding communities in the Detroit suburbs. We have seen our share of those who flip a house and make a grand profit, those who just make pennies, and those who lose their shirts.

If you have never flipped a house before don’t just jump right in. Make sure you have the expertise and financial capability to do it right. There are many other things to consider before you go out and buy.

Most real estate investment gurus will tell you that “Anybody can do it.” “Anybody can flip houses and earn a hundred thousand dollars in their spare time, buying, fixing, and selling run-down homes.” Well, that’s not exactly true. If it were as easy as these gurus claim it is, everyone would be doing it. Unfortunately, the sheer number of people who have tried to become wealthy real estate investors and have failed proves that not everybody has what it takes to succeed.

The following list describes the most basic qualifications you need to get started:

•  Nights (or days if you work the night shift) and weekends off: Flipping houses is like moonlighting at another job. Part-time flippers, often called weekend warriors, can succeed as long as they are committed to treating flipping as another job.

•  Financial stability: You should be paying all of your bills on time, including the mortgage on your primary residence, before you consider taking on another financial burden. Don’t look at flipping as a way to solve your financial difficulties – you may end up digging yourself into a deeper hole.

•  Energy: Couch potatoes need not apply. You need plenty of energy to work on a home while fulfilling the responsibilities of your day job.

•  Ability to function in a crisis: Flipping a house is more complicated than it seems and always more of a challenge than it looks on TV. If you commonly feel overwhelmed already, taking on another burden may not be prudent.

•  Organizational expertise: With flipping houses, time is money, so you need to execute the flip as quickly as possible. This requires an organized mind. You have to act as contractor to make sure all materials are delivered on schedule and that your subcontractors aren’t tripping over one another.

•  Basic math skills: To be relatively certain that you will earn a profit, you need to be able to crunch some numbers. Overestimate expenses and underestimate profits to give yourself a safety buffer.

•  A supportive family: If you’re married, make sure your spouse supports this new venture. Otherwise, you will not only be fighting the world to flip houses for a profit, but you will also be fighting your partner. This often leads to failure both with the new venture and with the relationship.

You may notice that some skills have been omitted from the list, such as the ability to rehab a home or the ability to list and sell the home yourself. You do not need to have all the skills required to flip a home yourself. However, you do need to be able to fill the gaps with people who have the essential skills. For example, if you are not very good at estimating the costs of repairs, you may want to hire a contractor or professional home inspector who is aware of repair costs to inspect the home and provide you with detailed estimates. A real estate agent can often be indispensable in assisting you in determining how much to pay for a property and how much you can eventually sell it for.

Although many people who flip houses fly solo, you do not have to take that approach. In fact, you can often flip more homes and do a better job of it by building a team, complete with an agent, home inspector, mortgage broker, attorney, and handyman/contractor. This approach is particularly beneficial for those who are just learning the ropes.

Ralph R. Roberts, GRI, CRS is an experienced real estate investor and consultant and the author of Flipping Houses For Dummies (John Wiley & Sons).

We have worked with many builders and investors that have been successful. One example is the joint work we are doing with Custom Edge Construction on the home at 47397 Bartlett in Sunflower subdivision in Canton, Michigan. Doug Hartleib completely transformed the house so that now it is so much more upgraded than the surrounding houses it is worth much more. Visit their blog to view spectacular before and after changes to the home.

There are many houses currently on the market that could easilty be flipped for a nice profit. For a free list leave a comment below or email us at team@bittinger.com.

When to buy foreclosures in Detroit Michigan Suburbs

alsted — Wed, 16 Apr 2008 16:38:46 +0000

The number of houses going to foreclosure each week in Wayne County is staggering. About 90 % of them are in Detroit and may not be the best bargains. Many however are in the suburbs and could present good buying opportunities.

Canton, Plymouth, Northville, Livonia, and all the surrounding cities are experiencing an increase in the number of homes that foreclose. Buying them can be a risky business so it is wise to know the process. See Foreclosure 101 for a complete analysis of the foreclosure process in Michigan. It varies from state to state so taking advice from a national resource could be risky.

Noel and I attend the Sheriff’s sale downtown when we have a listing that is about to be auctioned so we can get first hand knowledge of the auction details. There are typically 300 to 400 sales when we go and this occurs twice a week. That means a lot of homes are coming on the market at what appears to be rock bottom prices. Or are they?

There are many stages of foreclosure. Many of our clients ask us when they should consider buying. The discussion below should shed some light on the subject.

Foreclosure is a long, drawn-out process that usually begins as soon as the homeowner stops making monthly mortgage payments on time and ends when the homeowner negotiates a solution with the lender, sells the home and pays off the mortgage, or has the home sold at auction and eventually leaves voluntarily or is evicted. As an investor, you can jump in at any stage of the foreclosure process:

•           Preforeclosure: Purchasing the home directly from the homeowners prior to the auction often results in the best deal for both you and the homeowners. Because the foreclosure notice hasn’t been published yet, other investors may not be aware of the situation, reducing the competition. To discover pre-foreclosure opportunities, however, you need to network with people in your neighborhood and let them know that you buy foreclosures, so homeowners who are having trouble making their payments will know how to contact you. It also helps to network with bankruptcy attorneys, divorce attorneys, mortgage brokers, real estate agents, and others who may hear about foreclosures very early in the process.

•           Foreclosure auction: The foreclosure auction is the next stage in the foreclosure process in which you can acquire a property. Foreclosure notices are typically posted in newspapers and county news publications, complete with the date, time, and location of the sale along with details about the property, its owners, and the attorney representing the bank. To successfully bid at a foreclosure auction, you really need to do your homework and know what you are bidding on and how much it’s worth. Otherwise, you can get stuck paying tens of thousands of dollars for a worthless piece of paper. Don’t let this scare you off. You can find great deals at foreclosure auctions as long as you know what you are bidding on and you set your bid limit before the bidding commences.

•           Post auction: Just because the auction is over does not mean that you lost the property for good. If an investor purchased the property at auction, you may be able to purchase it from the investor. If nobody bid on the property, the bank takes possession (after any redemption period), transfers the property to its REO (Real Estate Owned) department, and then hires a real estate agent to list the property for sale. By establishing a relationship with the REO manager, you may be able to get an early lead on the property. In areas that have a redemption period, you may also be able to work with the homeowner to buy back the property from the investor who purchased it at the auction and give the homeowner a little extra cash for helping you do this. (During a redemption period, the homeowner has the right to buy back the property from the investor.)

If you decide to invest in foreclosures, the best strategy is to choose an entry point and focus on it. Specialize in preforeclosures, foreclosure auctions, or post-auction purchases until you become an expert on that entry point. You can then expand your operation to other entry points as you gain experience.

Ralph R. Roberts, GRI, CRS is an experienced real estate investor and consultant and the author of Foreclosure Investing For Dummies (John Wiley & Sons).

Since we deal with all aspects of the foreclosure market we can help you in any stage of the process.

Have you ever bought a foreclosed house before? Do you want to learn more about the process or have a list of local foreclosures sent to you daily? Call us or post a comment for answers on how our services can help you find a real steal.