Seizing Opportunity in Government-Seized Properties

Most real estate investors are aware of the potential profit from buying government-seized properties -- homes and other types of property the government has acquired from tax cheats, drug dealers and other criminals. Because the government isn't in the business of renting or flipping properties, they want to unload them as quickly as possible. While this is unfortunate for the previous owner, it creates opportunity for investors who act fast and know what to do. Following are some tips.

Educate yourself -- Read as much as you can about finding and buying government-seized properties and find a mentor if possible. Many metropolitan areas also have investment groups.

Consult a professional -- When it comes to buying government-seized properties, a knowledgeable real estate agent or atto
ey may be worth the commission. Find an expert who has done this before so they can anticipate any problems and plan for a stress-free transaction.

Finding the right home -- You will probably find a good selection of homes on various government websites. Join their mailing list so you'll be notified of new properties or auctions. If this doesn't produce what you want, check the local newspapers or visit the county courthouse. Drive through the neighborhoods you have targeted and look for signs of vacant property. If you can discover a government seized property before it hits the market, you'll have an advantage. Keep your eyes open for government auctions too.

Inspect the home yourself -- Unlike most home sellers, the government does not have to disclose anything about the condition of the property. Plus, they don't do repairs, or warrant anything. It would be wise to hire a professional property inspector or general contractor to thoroughly inspect the home.

Research the property -- After you've set your sights on a property, do your homework. Start with searching the tax assessor files at your county office -- either online or in-person. If possible, get into the property and perform an evaluation. Talk to the neighbors and get their opinion about the neighborhood and home values. And if there's an expert in the area that you trust, get their opinion. You want to know the approximate value of the home and whether or not it's a community you should be investing in.

Make your offer or bid -- Depending on whether or not you are making a traditional offer, or bidding at an auction, you've done your research and now have a pretty good idea of the value. Make your offer accordingly and stick to where you need to be in able to make a profit. Be sure to read all the rules and regulations associated with buying the property because they vary greatly -- from bidding over the internet to having to submit your offer through an authorized agent.
Stick to the terms -- Once again, terms vary from county to county, so know what they are and adhere to them. Some agencies require a 20 percent down payment and the balance due in 30 days, while other may require full cash payment. Some accept certified check, while others only accept cash or credit cards. Understand the terms before you submit your offer.

The market for government-seized property is hot right now. Month after month thousands of properties are being seized by various government agencies, and if you know how to buy them, you could be purchasing them at a fraction of their fair market value.