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Example: Foreclosure Deal

So the question is, how do you go about purchasing a foreclosure as an investment property? We're here to help, take a look at the example below. Here's an example of a foreclosure purchased as an investment property.


Location: Austin, Texas
Price: $391,920
Square-footage: 3,243 sqft
Type: Single-Family Home

From: RealtyTrac
Status: Notice of Trustee Sale
Year Built: 1998
Price/sqft: $121
Days on Market: 25 days
ZIP Code: 78734
Features: This property is a Notice of Foreclosure Sale. A notice was filed at the recorder's office by the lender's attorney signifying a public auction. This 3243 square foot property has 0 bedroom(s) and 3 bath(s). The estimated bid amount is $391920. This property will be auctioned at public sale on Apr 01,...

Access more information from Realty Trac with a FREE trial. Below is a sample of some of the details that they give you access to:

Default Amount
Recording Date
Entered On
Last Payment
Opening Bid
Auction Date
Auction Location
Balance
Loan Date
Loan Document Number
Transfer Date
Transfer Value
First Loan Amount
Judgment Amount
Land Total
Improvements
Assessed Total

Rough Numbers:
Down payment:
Loan amount:
Property tax rate:
Expenses: % of gross earnings
Appreciation:

Loan amount:
Interest rate:
Loan term:
Annual tax:
Annual insurance:

Monthly Principal + Interest:
Monthly tax:
Monthly insurance:
Total monthly payment:

Interest payment per year:
Mortgage payments for the year:
Principal payments for the year:
Per year appreciation growth:

Gross income:
Operating expenses (managing property, landscaping, insurance, property taxes, painting - there are fixed and variable expenses):
Loan payments:
Cash flow =

Remember: When you buy a home that's in foreclosure, you're most likely going to reap a property that's in need of a lot of attention and repairs. And, there might be liens on the property, other people who are owed money--get a clear title report to ensure that there are no liens or they're factored into the purchase price.

 

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