Bulk REO Investor Profit Strategies – Getting Started

The weakness of the U.S. economy has given rise to the largest epidemic of foreclosures in American history. Yet well-funded investors in real estate are seizing upon this notch to profit from an very much profitable new opportunity.

That opportunity is called Bulk REO Investing, and the opportunity is huge.

The basis of the Bulk REO business is foreclosures, so let’s question the foreclosure process now.

Understanding of the foreclosure process is central to understanding Bulk REO investing.

Mortgage lenders faced with a non-paying home owner send a large volume of threats, warnings and documentation to the borrower who is late. After a certain period, the lender will then formally start foreclosure proceedings. The ‘pre-foreclosure’ time starts with filing of foreclosure red tape and concludes at public auction.

The defaulted material goods is eventually auctioned, thus carrying out the foreclosure process. The lender regains ownership of the material goods if there are no buyers at auction. The material goods then receives the designation of being an ‘REO’ or the more formal name, ‘Real Estate Owned’.

Typically, lenders list their REO properties with local real estate agents in hopes of promotion the material goods to a retail buyer who will pay full price. But as a consequence of the weak economy, lenders are frequently promotion their REO properties far below their actual value. The trade-off is that the buyer must buy manifold REO properties in each transaction.

There is huge profit the makings in these REO packages for qualified real estate investors. One of the best ways to take benefit of Bulk REO Investing opportunities is to partner with a well-regarded source of funding. Some sources of funding for these transactions are: personal funds, hard money lenders, commercial lenders and non-conventional sources such as confidential investors and hedge funds. Additionally, one man is becoming very well known in the field of bulk REO investing, and his name is Sal Buscemi of Dandrew Hub Partners, a New-York based hedge fund.