With its beautiful shoreline, lush fir forests and stunning Cascade Mountains Bellingham, WA real estate is certainly outstanding property to consider investing in. Prices on land and homes have risen in the Bellingham Bay area during the last several years making it a little more difficult to find affordable housing for the average person. Because of this, many first time homeowners as well as investors sometimes turn to the foreclosure market in Bellingham, WA.
Although the Bellingham real estate market has not been hit with an unusual amount of foreclosures compared to many other parts of the nation, there are still an abundance of opportunities to find that steal of a deal. Everyone should realize that investing in Bellingham real estate or foreclosures is not “amateur night.” It can be risky. You must do a tremendous amount of homework and know what you are doing. It’s usually best to have a qualified real estate broker or real estate attorney represent you in this endeavor.
You can minimize your risks in the Bellingham real estate market
If you want to buy foreclosure properties in Bellingham, WA, you must know how to find the potential property and access its value. You must know how to carefully research and inspect the property, so you don’t get stuck holding a money pit – or ever worse, a totally worthless piece of paper. You must also learn how to deal with home owners, how to bid on property and how to buy well below the market value so that you can sell for maximum profit.
Do your homework and learn how to:
- Research property titles, mortgages and deeds
- Obtain financing
- Avoid the most common pitfalls
Good and bad candidates for buying foreclosures
Investing in foreclosures in Bellingham, WA is not right for anyone who is currently having financial problems and is hoping a foreclosure will bail them out. This is not easy money regardless of what the late night infomercials may say.
Foreclosures in the Bellingham real estate market can be very right for a person who has a ton of cash, a steady job, a reliable cash flow or a financial backer. A backer can be anyone from a business partner to your grandmother. If this is something you really want to do, you can always find sources for investment capitol.
What kinds of things do you look for as a Bellingham real estate foreclosure investor?
Lots of things, from top to bottom and inside and out. Look at cracks in concrete, windows, roof, and doors – look at everything. Foreclosures aren’t always in top-notch condition. The owners may not have been able to afford to keep up maintenance. If you can’t hire a professional home inspector in Bellingham, WA, do what you can by inspecting the property yourself from all angles outside.
Things to avoid when investing in foreclosures in Bellingham, WA
Buying from long distance, in a distressed neighborhood, preconstruction projects and avoid buying from anyone that promises you cash back at closing. This is totally illegal.
Types of Foreclosures in Bellingham real estate
Many aggressive investors go after foreclosures when there is a downturn in the housing market. Foreclosures are homes that people have lost because they didn’t pay their mortgage payments or property taxes.
Pre-foreclosure: The owner has missed three or more payments and the lending bank has started foreclosure proceedings.
Foreclosure Auction: The home is released to the mortgage company and they can arrange an auction.
Real Estate owned properties (REOs): Real Estate Owned by the lender, this status indicates the lender or bank now owns the property as a result of a foreclosure .
Each of these types of foreclosures offers its own particular unique opportunity for the investor. In Bellingham real estate, the homeowner can still list the property as a “short sale.” This is where the bank will consider offers that will not pay off the mortgage in full. The bank will forgive the difference owed because it will be less of a loss than if the bank had to go through all of the steps of foreclosure — foreclose on the property, prepare it for a sale and then resell it at a later date.
Most Bellingham real estate investors know they can often buy these homes for 15-20% less than market value. If the property goes through full foreclosure, the bank will either place it up for auction or list it with a good real estate agent. If the property goes to auction on the courthouse steps, bidding is usually extremely competitive, but it is here that investors often have the opportunity to make the largest profit.
The earlier you buy in the process, the better the opportunity of making a good profit. You must know the current value of the property, the elements of time and market cycles. If you have to make repairs, you must know how to figure your rate of return and in what time frame. If you have the necessary skills and qualities it takes for investing in Bellingham real estate and foreclosures, it can indeed be a very profitable investment.