Since real estate has become a lucrative occupation worldwide, many people are venturing into this field in hopes of generating large amounts of profits through it. So if you are a beginner when it comes to real estate investing or a professional interested in trying an effective investing strategy, you will find your luck by looking into distressed homes on sale.
The first thing you need to understand is what exactly distressed properties are. In simple terms, a distressed property is a property that is financially, physically, or both ways, unmaintained by its current owner. They are the homes in which their owner is unable to meet the mortgage obligations and are hence, at risk of falling into foreclosures.
Moreover, due to the COVID-19 pandemic crisis’s effect on the economy, many distressed properties are popping up more than ever before. Yet despite their growing numbers, it can be challenging to find distressed properties for sale that actually meet your real estate investment requirement.
Fortunately, many highly acclaimed investors like Lloyd Segal are helping out young investors with some of the tips and tricks they can use to invest in distressed properties.
As a real estate investor, author, and the president of the Los Angeles Real Estate Investors Club, Segal has spent many years working in the real estate industry and utilized his experience to offer his assistance in all legal matters revolving around foreclosure issues.
Many of his cases were a series of high-profile Chapter 11 bankruptcy cases that involved multi-million dollar real estate projects in major financial distress. Moreover, he also wrote his first book, “Stop Foreclosure Now in California: Save your home if you can – save your credit if you can’t,” where he wrote about helping distressed homeowners avoid losing their houses in foreclosures. From his book, Segal found himself in demand as a guest speaker for various real estate events around the world. Eventually, he began buying distressed multi-million dollar properties in Los Angeles County. He then rehabbed them and then either sold them off or put them up for rent.
His experience has allowed him to educate young investors on finding the ideal distressed properties for their needs. Some of these ways include:
Delinquent Mortgage Properties
Homes that consist of delinquent mortgage payments clearly represents homeowners in distressed properties.
If the homeowners cannot pay the mortgage, they will be at risk of exposing themselves to foreclosures and will most likely be willing to sell their property at a discount to avoid dealing with a foreclosure and the financial issues that accompany it. Luckily, you can find records of these types of properties at local courthouses.
Checking Out the Physical Appearance
One of the sure signs of fining a distressed property is by looking at its physical appearance. Some of these physical aspects include yards with overgrown weeds, faded paint, and broken windows.
You will also notice uncollected mails on doorsteps and lights that do not open at night. Overall, the property will stand out from its neglected condition amongst the rest of the houses in the neighborhood.