Bulk REO Investment Tips

There are more foreclosures in the United States right now than we have ever veteran before. But smart real estate investors are rotary these ‘lemons’ into ‘lemonade’ in an incredibly profitable new way.

That chance is called Bulk REO Investing, and the chance is huge.

Let’s take a moment to analyze the basics of this incredibly worthwhile business.

To know investing in Bulk REO, you have to know the foreclosure process.

As a home owner misses a payment or two, the lender sends the predictable barage of threatening letters and warnings. The lender directs the subsequent timing of the actual foreclosure proceedings. The ‘pre-foreclosure’ time starts with filing of foreclosure red tape and concludes at public public sale.

To exact the foreclosure process, the property is public sale to the public. Ownership of the property is returned to the lender if the property is not sold at public sale. The lender then categorizes the property as ‘Real Estate Owned’ – or ‘REO’ for small.

Typically, lenders list their REO properties with local real estate agents in hopes of promotion the property to a retail buyer who will pay full price. Though, REO properties are now often sold for far less than their ‘book value’. The trade-off is that the buyer must buy multiple REO properties in each transaction.

The depression in the United States has yielded huge profits to real estate investors set to take advantage. The most thriving Bulk REO Investors will have a well-respected source of funding for their transactions. Some sources of funding for these transactions are: personal funds, hard money lenders, commercial lenders and non-conventional sources such as private investors and hedge funds. Additionally, one man is becoming very well known in the field of bulk REO investing, and his name is Sal Buscemi of Dandrew Capital Partners, a New-York based hedge fund.