Perry, you could buy the books, tapes, and courses offered by Carelton Sheets, Dave Del Dotto, John Beck, Dolf De Roos, Robert G. Allen, and dozens of other â€œnothing down easy road to investment riches real estate gurus.â€ These "educators" all thrive by perpetuating the myth that foreclosures are - per se - good buys.
They were able to perpetuate that myth because foreclosures were often good buys in the depths of previous real estate depressions in the mid 20th century. Intriguing anecdotal examples of past bargains could be dug up and recycled as if they had just happened. Telling the "foreclosures are a bargain" story is a path to riches for too many of those people.
Some of the guru's just use actors and scripts. Others use rare but actual examples.
All along the public has been confused because of a freak few situations that occur when properties sold for "pennies on the dollar" at tax auctions and at cash only trustee sales.
Logic needs to be disregarded in order to connect the following statements, - statements which are based in fact, - just not when they are combined with each other:
1. You may be able to buy a home at a (trusteeâ€™s) foreclosure auction (For all cash, no contingencies allowed)
2. You can buy a home with poor credit.
( If you put enough down or have equity and pay a very high rate and points)
3. You can buy a home even if you have no job. (Again, put enough down, and or have sufficient income from sources other than a job.)
4. You can buy a home with 100% financing. (Special home buyer programs for owner occupants, who have sufficient income and great credit, or by borrowing against other assets and maxing out personal lines of credit, including credit cards)
Bad gurus list all of the above statements without my parentheses comments, and tell gullible people that they can do all of these things at once, and on the same deal.
Real estate boomed a few years back; foreclosures were terrible buys, then. The demand created by the myth far outstripped the supply. Today the supply of foreclosures in many markets outstrips the demand for them. For the first time in a decade banks have to price their REO's competitively to get them sold.
Occasionally, now in 2007 and into 2008, there are situations that occur when a foreclosure is a good buy. The great stories will occur and the next decade of charlatan â€œeducatorsâ€ will have fodder for the next decade of seminars and â€œsystemsâ€ to sell to yet another generation of gullible consumers.
To read the writings of somebody who rants better about this subject than I do, go to: