Jennifer Kinzle, Realtor, E-Pro

Here is a summary of a great article on Finding Foreclosures from CNN Money

1-It is easier to find a foreclosure today, you use a website like Realty Trac or Foreclosurepoint.com or better yet, find a specialist agent like me who can navigate the foreclosure market on your behalf. Agents have access to the "remarks" field in their databases and can pull out more detailed information than a search engine.

2-It's best to buy straight from a bank. The downside is the property is sold as-is, no disclosures but REO's are Real Estate Owned, meaning the foreclosure has been finished, the property is owed only by the bank and no homeowners are residing in the property. What you see is what you get. An REO will be a better deal for several reasons, including a lower list price, a chance to inspect the property and a guarantee of a clear title (no unexpected liens will show up at closing).

3-Bring in a contractor to look the property over and ask for a free estimate on the work the property will need to have done. Plan accordingly, an investment property for a rental may not need granite counters and stainless steel appliances, but if you're living in it, you will need at least a functional kitchen!

4-Bid low, as much as 20% off list price. Banks look at all offers and if there are multiple bids, buyers will be asked to submit their best and highest offer. The bank will then choose among these bids for a final offer.

5-Be patient and prepare to wait. Short sales take longer in my experience, and REO's seem to move faster. Banks are overloaded in this market, so let your agent keep in touch with the bank and listing agents on a least a weekly basis.

A "Seasoned Investor" just asked this question: when is a contract not a contract? As a real estate professional, I am not an attorney, however, in general, a binding contract must be signed by the parties involved. Meaning a buyer and a seller in this case must have a written, not verbal, agreement. As a Buyer's Agent in Elgin, I can send over the offer to the Buyer's Attorney, but there is nothing the attorney can do to enforce an unsigned contract. A verbal offer is not a binding contract. This is often the most stressful time during the buying process, as a buyer may have submitted a good faith offer, with earnest money and negotiations have begun, however a completed, signed contract is not done. Another offer can still come in and break the first deal, without penalty to the sellers. So, buyers need to make a sound offer and follow through in a timely fashion. Don't beat around the bush. And Buyer's Agents need to make sure Buyers understand that an offer is not a contract until it is signed and agreed upon. Only then can an attorney be brought in to review and enforce. Remember, a Buyer's Agent only works for the Buyer, they cannot represent anyone else in the transaction. They also work for the buyer for free, so use their experience and ask them questions.

Courtesy of HGTV.com

Did you know?

• Most homeowners tend to stay in their homes for about six years.
  
• The average bathroom remodel costs $10,500. They also have the highest return on investment- about 102%.
  
• The average kitchen remodel runs nearly $44,00 and can bring a return of about 90%.
  
• 13% of previously owned homes are for sale by owner.
  
• Most agents agree that the No. 1 reason homes don't sell is price.
  

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A very common question I see in the news feeds is how investors are taking advantage of the Elgin housing market. But first, a clarification: the Investor I refer to is one who does this professionally, for a living either full time or part time, buying, selling and flipping/rehabbing. They never live in the homes they are investing in. So, this type of investor has potential to gobble up tons of incredible deals at huge discounts with super low rates on mortgages, right? Well, sometimes. One of the biggest problems investors have is finding deals that create cash flow and equity. The market has fallen in a lot of places so much that equity is vanquished into the next decade at least. This leaves cash flow issues which in turn makes it difficult (not impossible) to find money. Private money lenders know this and have always been able to make high interest loans available for deals. But what about the investor who only buys part time or only a few properties? Smaller investors are needed now more than ever so don't back out. PM loans may not meet their needs in this market unless they have a ready buyer lined up or a way to quickly refinance. Use your resources wisely! Talk to a variety of lenders. Better yet, talk to fellow investors! A friend of mine, Jason Simpson, is known on Facebook as the Street Cop Millionaire but he offers a free e-book on investing that works nationwide at www.StreetCopMillionaire.com. I recommend looking at properties that require less work to fix up and in a specific niche or area like college housing that you know will always be in demand. Skip the short sales that waste time unless you know the agent is experienced and go find the sellers who need to relocate or have been on the market for a long period. You can get this info from any real estate agent, it's called Days On Market or Market Time. And remember, let's aim for a win-win deal so an investor can get a great deal while helping a seller who has to sell.

There sure are a bunch of mystery houses out there these days. I go out prepared when I am previewing properties or meeting investors. I don't always get to view the pretty houses, but after ruining enough pairs of shoes, one gets smart about what is practical. A big flashlight that works is the number one item I must have when going to see properties. I'm now on my third one. I have no luck purchasing a decent high beam flashlight. Next on the list, boots/shoes that are not pretty. This goes hand in hand with the flashlight, plus a reminder to never ever take the second to last step into a darkened basement unless you are fully prepared to be up to your knees in water! Third, gloves. There is nothing like signing a Mold Release to make sure you are in and out quick. Fourth, a notepad with MLS sheet because if you are up to your knees literally, you might want to make a note of that so you don't have to step into that particular basement again. Fifth, two pens because one always falls into the pond in the basement or runs out of ink prematurely. Sixth and most importantly, is a sense of adventure. I can appreciate my own home a lot more after returning from the depths of mystery REO's. And every now and then, I am pleasantly surprised when I open the door to a fresh opportunity. Besides, most investors respect an agent who isn't afraid to get a little dirty while in the field. My best clients are the ones up to their knees with me!