Do you look forward to Black Friday? I didn’t but now, every since I have been teased intensely about my outdated television, I’m gearing up for it.
Makes you wonder if there are any Black Friday real estate deals out there. There are. You have to know how to handle it. The first thing you do is look in the auction section of the paper or on auction websites. If they require all cash, no problem. There’s a way to make it happen.
This method is a bit risky but only if you don’t do your homework.
1. Find a house that doesn’t need any work done. Many of the auctions have fixer uppers, but sometimes you can find one that wasn’t vandalized or was taken care of.
2. Then, you go get pre-approved from a bank.
3. Next, you go to a hard money lender. They require you to have 30% down for them to cut you a cashier’s check, but there are some out there that won’t take the money. They just want to know its in the bank.
4. When you win an auction, make sure you only bid 70% or less of the comps (in the same neighborhood).
5. Then, you pay the hard money lender their fee, probably about $10,000, and you finalize the loan with your bank.
The bank transfers the money to the hard money lender and you just saved 30% on your real estate purchase. The sticky part is to make sure you have enough cash for the down payment. Negotiate with the hard money lender for buyer-friendly terms. Maybe they won’t require you to write them a check for 30%.
Now it’s really Black Friday! Walmart can’t offer you that big of a deal. Be careful though. Investors say this is a viable option but only if you play it smart.