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HOW TO FIND A REAL ESTATE BARGAIN
© 2000 by Jon Richards
The best way to begin your career in real estate is to come up with a good,
small, older apartment building – well located, and at a low price, with a
small cash down payment.
There is several ways to find this type of a real estate bargain. I will
begin with the most unconventional methods since they often produce real
bargains and then concentrate on conventional methods.
Remember, however, there is no single formula that works all the time. The
successful investor has a network of people who know that he or she is a real
estate investor, and who will tell you about vacant properties, or troubled
sellers or other opportunities that you could not find on your own. So consider
the following ways to find properties, develop your own; develop a system, and
an organization of people who are helping you.
UNCONVENTIONAL METHODS FOR FINDING A BARGAIN
- Make a friend out of an owner of a junk and disposal service business.
Some owners of "hauling" businesses make much more profit out of
real estate investments they come by that they ever make from their hauling
services. Perhaps someone, who is contemplating a move, perhaps a new widow
or widower, calls the disposal service to clean out his or her basement or
attic. Over the telephone, the caller says "We are moving," or our
aunt just died." In the course of these arrangements, the
"disposal service operator" is often the first to know of the
owner’s intention to place the property up for sale. In this situation,
ingenuity and imagination on the part of the income buyer is absolutely
mandatory, and can lead the astute buyer to some good deals. I offer the
hauler $25 for any lead and $500 if I buy the property.
- Watch death notices in the newspaper. Frequently, the attorney handling
the estate is mentioned in the notice. If not, inquire of friends, relatives
or neighbors of the deceased, or the surviving spouse, to find the name of
the attorney. Then, make your pitch to the attorney who may have to dispose
of the real estate in the deceased person’s estate. In this way, you can
become the first to bid. It is rare that a lawyer will insist on nay type of
commission.
- Work closely with local attorneys on a personal basis. These attorneys
frequently offer properties for sale on behalf of out-of-state and other
type of sellers who prefer not to handle the sale transaction themselves, or
hire a real estate broker.
- Watch the newspapers for public auctions, bank foreclosures, and divorce
settlements.
- Check the Probate Courts for filings of deaths and divorces.
- Follow FHA and VA foreclosure sales. We mail these lists out regularly.
Many of these homes can truly be bought for no money down.
- Use mail carriers and other "Spotters" to advise you of vacant
buildings. Then trace the owners through the local assessors and tax
collectors offices. If this does not work, then contact the neighbors and
friends of the owner who has moved away, or contact a tenant in the
building. Use common sense to locate owners. Active Management has computer
facilities to access all California county records and we may be able to
help you locate the owner of vacant buildings.
- Investor Groups: See the list of telephone numbers and investors groups
all investors should have. These groups are not only a good source of
support, but can help you locate good deals in bargain properties.
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