I will give you my insights as someone involved in analyzing tens of thousands of "deals" and being involved in some fashion in the settlement process since 1994 from the view point of a principal partner of a formerly large Title Insurance Agency.in New Jersey My primary role was Vice President and Head Underwriter/Examiner besides my ancillary role as baby-sitter to a staff of 25+(back in the boom years). Even back in those days,flips were frowned upon, but tolerated if properly disclosed,coordinated and executed by honest ethical "Wheeler-Dealers".The Title Insurance business is a volume game with low profit margins and "high expenses" to the Agent/Insurer. We hate risk and litigation. The Title Insurers have been scared by "Pretender Lenders and Attornies" Almost All Will NOT Allow Participation to a Flip by their Agents" So don't call me on flip/double closing questions. I'm not gonna lose my Underwriter/Agent contract to make a few hundred bucks to your tens of thousands. Simple Math...I could be a blunt person at times.
The Pretender Lenders are now choking on their own arrogance and restrictive rules with increasing inventory and loses. We are in a "Buyers" Market, but they act like Real Estate at retail prices are a hot commodity?
Now why read my blog? Well, I'm am now one of those "Wheeler-Dealers" in Real Estate. For the last year I have been preaching that the opportunities lie in REO's and not so much in "Shorts". The banks prefer shorts because they end up with more not less,while once they take possession they become the "Distressed Seller"
Now without making this blog too long here are a few thoughts of mine;
1) Almost ALL Foreclosure suits(in NJ) could be dragged out for YEARS. Values are dropping
2) Almost ALL could be challenged by a half way descent attorney,but MOST aren't because they would ask for a large retainer(opportunity here,for those thinkers out there"
3) Most Investors think "Short Sale or REO's are all deals" THEY ARE NOT, They are Opportunities and Possible Deals.
4) Pay attention to the news about the validity of MERS,Robo-signers,Title Insurability, Foreclosures being challenged after the bank forecloses.
5) Most Investors think that knocking the lender down and getting 60cents on what was owed is a good deal.Not True !!! Example; Amount Owed $350K, you talk them down to $210K,but the market value now is only $240K.You want to flip it,but you just took on a high risk retail flip.You have it at 87.5 cents on the dollar,after closing costs,transactional lender fees,sellers concessions,realtor/attorney fees figure 10% your left with about $6,000....might as well been the realtor. By the way, this is typical !!!
6) The above example is NOT a deal but could have been if structured differently
Stay Tuned...for some of my Solutions
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