It's no secret that properties in foreclosure permit home buyers and investors to purchase a prime piece of real estate for a low price. Few things are more profitable than buying a property worth six figures for only pennies on the dollar and turning it for a quick profit or using the money you save to add a nice addition to your savings. The following are some common pitfalls that, when avoided, can safeguard time and money, as well as heartache.

Bidding Excessively

Bidding on foreclosed property can be quite a blind experience, as you are not told what other potential buyers are bidding. This leaves the door open for you to place a bid greater than the fair market value. Nevertheless, with the accurate research, you can figure out this value in advance so you can place your bid correspondingly and save a little cash.

Forgetting to Get an Inspection

A comprehensive inspection should be the main concern when opting to buy a foreclosed home. Nevertheless, a number of buyers and investors pass over this very important step in an attempt to save a few extra dollars. Inspections may be expensive, but the preliminary expenditure in advance can possibly safeguard thousands after the sale. A thorough home inspection will identify the repairs crucial to improve or maintain the property. While some necessary repairs may be obvious, the inspection can expose unknown problems such as plumbing or electrical wiring. Be wise and choose to have a professional home inspection.

Neglecting to Execute Proper Research

When thinking about the purchase of properties in foreclosure, it is necessary to familiarize yourself with other properties available in your area of choice. If not, you can wind up getting a home you think is a great deal but turns out to be a pain. Community trends, current and considered zoning issues, air traffic, street noise, condition of neighboring properties and a multitude of other peripheral factors can have a major effect on the home's property value. Knowing this information beforehand help you avoid setbacks later on and the home will be a lot easier to resell.

Imagining All Foreclosures are Great Deals

Don't Forget, at the time the government puts a foreclosure up for auction, the state of the property is not on their list of concerns. As a matter of fact, it is typically not taken into account at all. The foremost aim of the seller is divest themselves of the home in question as quickly as possible while regaining as much of their investment as achievable. What this signifies is that the condition of these properties is not guaranteed. Rather, it's up to chance.

While there are other pitfalls to consider when deciding to purchase a foreclosed property these are some of the most recurrent and potentially detrimental. Taking these factors into consideration will prevent you from falling prey to identical mistakes that home buyers and investors just starting to purchase foreclosures frequently make.

Take a look at Homes in foreclosure in Temecula, CA. You may want to consider Bank foreclosed homes in Murrieta, CA. On the East Coast, consider Odenton affordable property in Maryland.

Article Source: http://www.articlesbase.com/real-estate-articles/pitfalls-to-sidestep-when-buying-real-estate-in-foreclosure-695407.html

I often get questions from potential investors about the basic functions of a mortgage fund (aka a mortgage pool). Therefore, I've decided to write about mortgage pools in general to clear up any misconceptions.

Mortgage pools are securities that are required by state and federal agencies to provide complete and full disclosure through an offering memorandum. A mortgage pool is a collection of capital contributions from many investors and is usually in the form of a limited liability company that sells shares. The investment pool of capital is then used to purchase a number of different loans, which are commonly called mortgages or trust deeds, and secured by real estate.

There are basically three ways to invest in mortgages, and regardless of a person's real estate or investment acumen, there is a mortgage investment option available today that fits their investment portfolio. The three ways are: funding a mortgage directly, participating in a multi-lender or syndicated specific mortgage, or by investing in a mortgage pool.

The purpose of a mortgage pool is to create a long-term investment vehicle that provides for the fund's management and a favorable rate of return to investors, while providing them with a diversification of risk and stability. Also, mortgage pools are redeemable on relatively short notice so they offer more liquidity than a direct mortgage or syndication.

For investors who don't have the real estate expertise and don't want to commit the time and energy to learn, the best route is to find a company that offers mortgage pools, like The Grace Fund LLC. These companies employ the services of a manager and administrator of the mortgage pool on the investor's behalf who furnishes the investor with a monthly statement to keep them informed of their account balance, current yield and other details. The mortgage fund manager is paid a modest fee to research the proposal, make the lending decisions and handle all of the payments and administration. Fees earned by the manager are not paid by the investor, but rather a percentage of the income earned on the mortgages and servicing fees charged to the borrower.

These mortgage pools work through a four-step process: 1) investors purchase shares of a company; 2) the company purchases a number of qualified trust deed investments or mortgages; 3) the trust deeds and mortgages provide a return to the company and; 4) the company distributes a return to the investors from monthly cash flow, or growth through a Distribution Reinvestment Plan instead of taking a monthly payment.

Investing in the mortgage market can be a solid option for investors who want to benefit from the commercial real estate market without actually buying real property. In the past couple of years, returns of 10% to 12% or more in mortgage pools - compared to 3-4% for more mainstream investments - have been common. The pool is continuously managed with a primary objective of securing new mortgages to replace mortgages that mature, thus insuring investors a steady stream of passive income.

Monthly income from most mortgage pools usually varies as interest rates change or when mortgages are paid off. The returns to investors from the mortgage pool would follow market interest rate increases or decreases. The investor in a mortgage pool earns a blended rate of return on investment based on the interest earned from each respective mortgage. However, in the case of an investment in The Grace Fund, monthly distributions of 1.25% (15% annualized) are made to investors. To achieve the higher return, the Grace Fund mortgages are fixed at 15.5% annual interest to the borrower, an affiliate of Grace Realty Group. The higher rate reflects a premium to distinguish The Grace Fund from the many competitors vying for investor dollars in the marketplace.

I believe the most convenient, effortless and safest method for the average investor to invest in a debt instrument is through a mortgage pool. They pool their money by buying shares in the fund, and the interest earned from the mortgage payments received from the borrowers becomes income for the fund. All income earned is distributed to shareholders according to their proportional interest. Simple.

Similar to a mutual fund, a mortgage pool provides a vehicle to diversify a portfolio of investments - in this case, mortgages instead of stocks or bonds. Investing $50,000 in a mortgage pool consisting of 25 loans valued at $15 million provides better security through diversification than a $50,000 investment in a single loan secured by a single property.

Unlike a mutual fund, mortgage funds are secured by real estate and not subject to the same volatility as the stock market. Most mortgage pools are backed by well-underwritten and well-secured real estate loans. This is particularly true when the mortgages are secured by property that is financed at a very low loan-to-value ratio. To further mitigate risk, additional security is realized when the borrower purchases properties at a price far below their replacement cost with considerable value-added possibilities (buy low, fix up and sell strategy).

Another advantage to mortgage pools is that they are very suitable for most tax-deferred savings accounts including IRAs and 401ks, making them a good fit for future retirees or anybody else on a fixed income. An investment in a mortgage pool should be considered for inclusion in every serious investor's portfolio.

Article Source: http://www.articlesbase.com/real-estate-articles/mortgage-pools-jump-in-the-waters-fine-695167.html

Doug Mitchell is the CEO and President of Grace Realty Group, Inc., a Florida investor in value-added commercial real estate projects located in the Southeast United States. Grace offers individual investors debt and equity positions in the projects it redevelops.

Due to the financial difficulty that the world is facing today, many are thinking of relocating. Some wants to find better opportunities while others want to have a new start. This is why it is important to find out more about the possible cities or towns that you wish to transfer to.
The Gilbert city in Arizona is a great place to start. Several realtors are more than willing to assist you in finding the perfect house among the groups of Gilbert homes. Power Ranch is among the most popular neighborhoods in Gilbert. Here are some of the reasons why Gilbert is a good place to relocate:
The city continues to develop, thus providing opportunities for its residents. Looking at Gilbert today and comparing it to the town it used to be ten years ago, you can definitely say that the city has improved. The SanTan Village Regional Shopping center and Rome Towers are just two of the proofs of the growth of the city.

There are also several opportunities to neighboring communities. Apart from the growth that the city is experiencing, nearby cities also presents promising opportunities. One can commute to these nearby locations and find work. In fact, several residents of the city have been commuting to neighboring towns to work. This gives you more options if you choose to live in the city.

Although the industrial aspect of the city is growing, it still upholds its agricultural activities. One cannot deny that industries are more appealing to many investors. However, agriculture is also vital. Although the city continues to grow and develop, it does not neglect the importance of agriculture. The locals feast on organic vegetables grown in Gilbert farms. Their farmers’ market does not only provide quality food but also helps the economy of the city.

If you are looking for a place to stay, there are various options to choose from. The sizes of the houses vary. You will be able to find a place suitable for you and your family. Aside from Power Ranch, you can also find other properties. If you are still undecided, there are properties you can rent. Other properties include lots, industrial areas, commercial spaces, and brand new homes.

It has an easy access to various establishments. Residents love to live in Gilbert because of convenience. They have various amenities like parks, public lakes, museums, churches, shopping centers, and libraries. This is what most people want to have access to. They want to go home to a peaceful community but they also want to have a nearby place where they can take their family for some quality time.
Nowadays, work and rest are very important. We want to have a job that is stable and a home that is relaxing. If the community provides both, what else would you look for? If you are looking for a great place to relocate, Gilbert is a great town to begin your search. It provides various opportunities as well as high quality estates that will surely make you feel at home.
Summary:
What makes Gilbert a great place is that it is that it has a lot of great things to offer. Aside from beautiful houses and inviting environment, it also offers opportunities for its residents. It shows growth and development which gives hopes to thousands of people.

Article Source: http://www.articlesbase.com/real-estate-articles/gilbert-city-five-reasons-why-it-is-a-good-place-to-relocate-695152.html

Bill Cotter is an expert and professional real estate agent that specializes in Power Ranch featured on http://www.ourbestrealestate.com