All foreclosure strategies require that you be able to assess the market values of properties.
A normal nonforeclosure purchase contract usually has a contingency for the buyer being able to obtain acceptable financing.
If you agree to pay too much, the lender’s appraiser will clue you in pretty quickly, and you will not qualify for financing. It is a sort of safety net for you. You do not have this safety net when buying preforeclosures or when buying at auction.
Normally you do have it when buying postforeclosure properties.
Other than that overall consideration, the following are the character traits important for various foreclosure strategies.
To purchase preforeclosures, you must be:
• able to remain detached when faced with others’ problems;
• a good negotiator;
• not easily discouraged;
• very goal-oriented; and,
To purchase properties at auction, you must be:
• disciplined; and,
• willing to take some risk.
To purchase postforeclosures, you must be:
• patient (the best buys are after the property has been on the market for over six months); and,
• not easily discouraged.