Foreclosure buying

Just bought a foreclosed townhouse. having a contractor fixing it right now and hopefully can resell it soon.

I basically jumped into this blindly. did not read any real estate investment books, no siminars attended. no expert / experienced help.

got the idea with a friend of a friend mentioned that a bizman here wanted to get a loan with 10 half-completed-but-foreclosed houses. the guy got rejected by the bank. those houses are too expensive for me but i thought buying a foreclosure and flipping it might work.

thanks har.com, i recently discovered that it has a section just for foreclosures. spent some time filtering through, bookmark the interested ones; also a realtor friend does not only offer low commition but has been very helpful and patient indeed.

however i have discovered that buying foreclosures are not an easy task:

• since i am not an expert at fixing houses, i need a contractor to give me an estimate. i have not found a contractor that is 1) very trustful; 2) capable of doing a lot of stuff, not only painting/installing floors; 3) easily available to view the property and have time to take the job. i guess the contractor might end up making more money than i will.
• many foreclosed properties have foundation problems. i don't buy those even though sometime they are so cheap. foundations are difficult to fix.
• foreclosed houses attract multiple bids. this bidding is always closed, i.e. you don't know how many others are bidding and you don't know their bidding price, or even whether there are any other bidders at all or the selling agent is just bluffing.
• foreclosures are owned by banks, who are very ignorant even they have a bad property in hands and are already loosing tons of money on it.
• some strings are probably attached with the documentation. i always fear some potential traps.
• i am buying it with cash (so you know how small investment it is), so no loan involved here. today's banks probably don't want to give me a loan for flipping foreclosures.
• right now i am not confortable with leasing it out. but we will see.

i start with this small townhouse, which is not my best pick in mind. I prefer single family w/o monthly maintance fee. after all these obstacles, i just want to sell it with a few grands of profit. maybe 10% in a few months is satisfactory to start with.

Wish me luck.