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The weakness of the U.S. economy has given rise to the largest epidemic of foreclosures in American history. However, opportunistic real estate investment professionals are turning the recession into great profits with a bit of creativity.

The real estate investing strategy du jour is called ‘Bulk REO Investing‘ and is a real monster.

The basis of the Bulk REO business is foreclosures, so let’s analyze the foreclosure process now.

Understanding of the foreclosure process is central to understanding Bulk REO investing.

When a home owner begins to miss payments on their mortgage, the lender begins to send late/overdue notices to the home owner. The formal process of foreclosure begins at the lender’s discretion. The ‘pre-foreclosure’ time starts with filing of foreclosure paperwork and concludes at public auction.

Foreclosure is completed when the defaulted property is auctioned. If there are no buyers for the property at auction, the property is returned to the lender. Such a property is then classified as an ‘REO’ (Real Estate Owned) by the lender.

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With more foreclosures now than ever before, America’s weak real estate market seems to set new dismal records each month. But smart real estate investors are turning these ‘lemons’ into ‘lemonade’ in an incredibly profitable new way.

This new opportunity – known as ‘Bulk REO Investing’ – is so huge it’s captured attention from wealthy investors and private investment funds alike.

Take a just a minute to consider the basics of this highly profitable business.

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

Mortgage lenders faced with a non-paying home owner send a large volume of threats, warnings and documentation to the borrower who is late. After a certain period, the lender will then formally begin foreclosure proceedings. The name for this period is ‘preforeclosure’.

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No generation in American history has ever experienced the number of foreclosures and defaulted mortgages as is happening now. But smart real estate investors are turning these ‘lemons’ into ‘lemonade’ in an incredibly profitable new way.

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

Consider with me, if you will, the fundamentals of the Bulk REO business.

To understand Bulk REO investing is to understand the foreclosure process.

A home owner who misses one or more mortgage payments is faced with an ever-increasing volume of threatening correspondence from their lender. The formal process of foreclosure begins at the lender’s discretion. The ‘pre-foreclosure’ time starts with filing of foreclosure paperwork and concludes at public auction.

Foreclosure is completed when the defaulted property is auctioned. If the property is not purchased at auction, ownership reverts to the original lender. This property is then considered to be ‘Real Estate Owned’ by the lender, also known as an ‘REO’ property.

Read the rest of this entry »

The weakness of the U.S. economy has given rise to the largest epidemic of foreclosures in American history. Yet as always, this challenge has given rise to a huge new opportunity for alert real estate investors.

The new opportunity is known as ‘Bulk REO Investing’ or ‘REO Package Investing’ and it’s a huge opportunity.

Consider with me, if you will, the fundamentals of the Bulk REO business.

Understanding of the foreclosure process is central to understanding Bulk REO investing.

As a home owner misses a payment or two, the lender sends the predictable barage of threatening letters and warnings. After a certain period, the lender will then formally begin foreclosure proceedings. The name for this period is ‘preforeclosure’.

Foreclosure is completed when the property is put up for auction. If the property is not purchased at auction, ownership reverts to the original lender. Such a property is then classified as an ‘REO’ (Real Estate Owned) by the lender.

Read the rest of this entry »