I enjoy pre foreclosure investing mostly because you don’t have to deal with a bidding war on a property that is being bought for less than its actual worth.

You can approach an owner that is about to lose their home and offer to purchase before it goes into foreclosure.

This should entice the owner because it’s better to have a bunch of late payments on their credit than an actual foreclosure.

It’s good for the bank because they don’t have to take possession and put this property in their inventory. They are not in the business of selling homes, therefore, they would rather negotiate a discounted profit then no profit at all.

The most tedious task in pre foreclosure investing is negotiating the price with the bank.  Depending on how desperate they are, sometimes you can get the bank to take as low as fifty percent of the original purchased price, especially in today’s market.

In a typical market, the discount is usually between seventy and eighty percent of the original loan amount.

Although it can sometimes take up to two years to get a response to your offer, there are many laws being passed that are starting to make these banks respond a lot faster.

In some cases you can get an approval as fast as thirty days. These are the lovely deals.