Use Options to Profit from Properties with Correctable Problems
First things first: You must be very careful when using this option strategy, so that you are not perceived as just another sleazy opportunist trying to take advantage of the plight of disaster victims. And this is why it is best that you never contact any property owners in disaster areas until after the dust [...]
In most cases, the only way to remove a cloud on a property title is to go through a legal process known as a quiet title action or lawsuit, during which an adverse claim or cloud on the title to real property is removed. In the lawsuit, the owner or plaintiff names all of the [...]
The term cloud, as it relates to real property, is a claim or encumbrance recorded against a property’s title that prevents the owner from having a clear and marketable title to the property. And the problem with a clouded title is that title insurance companies will almost never issue a title insurance policy that insures [...]
Personally, I like properties with problems that scare off most conventional real estate investors. Generally, these are properties with correctable problems that appear to be complicated and usually require some sort of specialized knowledge in order to be solved. However, in most cases, it is the common misperception of how difficult the problem is to [...]
The three types of problem properties that scare off most conventional real estate investors are: 1. Stigmatized properties: These are properties that have a stigma attached to them because of some traumatic event that has occurred on the property, or the property is located near undesirable properties and nuisances. 2. Contaminated properties: These are properties [...]
One of the best sources of problem property leads that is often overlooked by most investors is local, county, and state government agencies. For example, one of the types of properties that I buy options on is vacant commercial properties that have been repeatedly cited for non-structural code violations. I have chosen this particular type [...]
The biggest mistake that investors sometimes make when using this strategy is that they bite off more than they can chew. They do this by trying to correct the problem affecting the property themselves, instead of reselling their option to a niche investor who specializes in turning problem properties around. You should be using this [...]