Hi All!

I took a week off from blogging due to spring break. I have to admit, I got a whole lot of lazy done--I went to Tampa and hung around the pool and took naps! What a great way to recharge!

Anyhow, the latest questions I've been hearing have to do with all the deals out there in real estate. With the "mortgage crisis" there are a lot of deals, and figuring out what is the best avenue for you can be a challenge. With all these deals--are they really deals? Well, that depends.

I explained previously what a short sale is--where the bank will take less than what the home is currently worth. In essence, this is a "pre-foreclosure" where the seller/owner is doing what they can--working with the bank in getting the property sold so that they can move on.

But what about buying a foreclosure? Well, one way to do this is to buy it from the bank after they have already foreclosed on it, and now they are the "owners" of the property. Some banks will try to sell it on their own initially, and if it doesn't sell quickly enough, they will list it with a Realtor, and then you'll find it on the multiple listing service.

There is also the option of buying a foreclosure on the courthouse steps. This can be tricky, and you need to be prepared before walking up to the courthouse steps. I know different counties do it differently, however, in Okaloosa County, Florida, if you win the bid on the house, you have to have the FULL AMOUNT to them by the end of that business day. There is usually a bank representative there at the auction to make sure that the bidding starts at what the loan amount is (at least), so the bank doesn't entirely lose their investment (ever hear of those cases where someone bought a house on the courthouse for $100? I've heard of them but never met anyone who actually accomplished this.) So the bidding will start at or about what the loan value is. The disadvantage of this is also that you don't get to look inside the house and determine how much you want to spend prior to the auction on the courthouse steps. You might get lucky enough to peek in the windows and/or do a drive-by, but that's about as far as you get. Also, you need to make sure there aren't other liens on the property you will be responsible for--like a tax lien, or mechanics lien, a 2nd mortgage holder, etc. This is where it is wise to get a title search done with a title company if you're serious about this route. Also, check to see what the values of similar properties are in the area. If similar houses in the area are worth $250,000, and bidding starts at $250,000 (yes, this does happen), this might not be such a good deal-especially if you don't know what the inside looks like.

After doing your due diligence--checking all your facts--and you decide you want to try this route to get a house, decide BEFORE showing up at the auction what the HIGHEST amount you will bid--and stick to it. It's easy to get caught up in the frenzy and keep upping the amount until you realize you're short, and all the work you've done got you nowhere.

Some people that buy houses on the courthouse steps have funding all ready prior to showing up--if they don't have the cash ready that day. Even if one has cash in the bank, be sure to talk with your bank a few days ahead of time and find out what their requirements are. They may have requirements/approvals they need to accomplish for large amounts of cash withdrawals, or even large checks drawn on your account--even if it is sitting in your account.

Hard money lenders are also available to help out, or you can get multiple investors each putting up a predetermined amount. There are many options, and whatever you decide to do, make sure to do your homework ahead of time. It will help things run much smoother on the day you get the house.

Good Luck!

www.clerkofcourts.cc/foreclosures is the website for Okaloosa County foreclosures. Next week I'll talk about Tax Deed Sales and how they work!