sell business get into forclosures?

iponnet · #1 06-06-2007, 05:53 PM

ok I own a small cab company that is worth probably around 140K, but the problem is it doesnt generate awhole lot of revenue and I am frnkly tired of running it and am looking to do something else... my brother(loaded) is trying to get me to get into buying fixing up(I can do alot of the fixing myself) and selling foclosures since there seems to just be aton of them around where we live(san diego), but the problem is neither of us has any experience with this!!

I mean he knows some brokers and stuff but I am naturally a conservative person and am skeptical about the pay off in doing this right now?

what do you guys think about this? should I go for it or stay put for now?

maxtower · #2 06-07-2007, 03:23 AM

I would think this would be a tough time to get into this business since it is becoming increasingly difficult to sell places. Why not wait a few months and see if there will be more and cheaper foreclosures coming on to the market.

RobertHunter · #3 06-07-2007, 03:40 PM

There is probably a number of reasons why there are a lot of foreclosures on the market right now in your area. There is a good chance that one of those reasons is that homes are just not currently selling in your area. I would be very careful getting started in flipping houses in this market. I personally would not even consider trying to flip a house at this time if I could not buy it for 65 cents on the dollar or less.

Blarg · #4 06-07-2007, 09:33 PM

I was just talking to a guy who does this for a living. He told me about all the ways there are to lose a couple hundred thousand dollars overnight, and how even with his decades of experience, he has come extremely close to getting into the wrong deal and doing just that. Whatever you decide, be extremely careful, and make sure you do everything humanly possible to be sure the title is clear. Don't trust the banks. He told me about one property that had gone through four different loans before it finally came out that what everyone was thinking were first mortgages were actually second mortgages, each being lent out on the premise that they were subordinate to no other loan. Truth was, each in sequence was subordinate to the same unresolved $200k judgment against the house. Some guy buys the house and is literally out $200k almost overnight.

#5 06-07-2007, 10:54 PM

Tien · #6 06-07-2007, 11:12 PM

It is just as dangerous as starting to play poker.

You wouldn't deposit 1000$, start at 200 NL and learn from there would you?

I am in this business and get EDUCATED before you make a transaction. Once you are educated, it isn't a dangerous market to enter in at all.

Nomad84 · #7 06-08-2007, 01:05 AM

[ QUOTE ]
I was just talking to a guy who does this for a living. He told me about all the ways there are to lose a couple hundred thousand dollars overnight, and how even with his decades of experience, he has come extremely close to getting into the wrong deal and doing just that. Whatever you decide, be extremely careful, and make sure you do everything humanly possible to be sure the title is clear. Don't trust the banks. He told me about one property that had gone through four different loans before it finally came out that what everyone was thinking were first mortgages were actually second mortgages, each being lent out on the premise that they were subordinate to no other loan. Truth was, each in sequence was subordinate to the same unresolved $200k judgment against the house. Some guy buys the house and is literally out $200k almost overnight.

[/ QUOTE ]

I know nothing about this stuff, but wouldn't a title search and title insurance protect you in this kind of scenario?

iponnet · #8 06-08-2007, 06:32 AM

I think I will wait till the market stabalizes abit before jumping in and also take time to do more research on this!!

probably will start with a small condo to get an idea on how the process works. thanks for all the advice

Blarg · #9 06-08-2007, 01:10 PM

[ QUOTE ]
[ QUOTE ]
I was just talking to a guy who does this for a living. He told me about all the ways there are to lose a couple hundred thousand dollars overnight, and how even with his decades of experience, he has come extremely close to getting into the wrong deal and doing just that. Whatever you decide, be extremely careful, and make sure you do everything humanly possible to be sure the title is clear. Don't trust the banks. He told me about one property that had gone through four different loans before it finally came out that what everyone was thinking were first mortgages were actually second mortgages, each being lent out on the premise that they were subordinate to no other loan. Truth was, each in sequence was subordinate to the same unresolved $200k judgment against the house. Some guy buys the house and is literally out $200k almost overnight.

[/ QUOTE ]

I know nothing about this stuff, but wouldn't a title search and title insurance protect you in this kind of scenario?

[/ QUOTE ]

You can't always get that. And look at the banks, in this example. In their normal process of granting loans, four banks did their searches and all of the results were incorrect.

DrewDevil · #10 06-08-2007, 01:20 PM

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
I was just talking to a guy who does this for a living. He told me about all the ways there are to lose a couple hundred thousand dollars overnight, and how even with his decades of experience, he has come extremely close to getting into the wrong deal and doing just that. Whatever you decide, be extremely careful, and make sure you do everything humanly possible to be sure the title is clear. Don't trust the banks. He told me about one property that had gone through four different loans before it finally came out that what everyone was thinking were first mortgages were actually second mortgages, each being lent out on the premise that they were subordinate to no other loan. Truth was, each in sequence was subordinate to the same unresolved $200k judgment against the house. Some guy buys the house and is literally out $200k almost overnight.

[/ QUOTE ]

I know nothing about this stuff, but wouldn't a title search and title insurance protect you in this kind of scenario?

[/ QUOTE ]

You can't always get that. And look at the banks, in this example. In their normal process of granting loans, four banks did their searches and all of the results were incorrect.

[/ QUOTE ]

Why wouldn't you be able to get title insurance?

I would never advise anyone to buy real estate without title insurance, and yes, it is designed for just the kind of scenario you mentioned.

A lot of RE investors play it fast and loose and close deals on the kitchen table without title insurance. Makes things quicker and easier, but also easier to get burned.