Profiting From Probate Property
Topics: probate homes, probate property, probate investing, property investing, real estate investing
f you are interested in beginning a new career in real estate investing, there are many routes you can take. Foreclosure and short sale investing is one obvious option, but real estate investing is not limited to these two venues. There is actually quite a bit of money to be made by investing in probate property.
Probate property is property that someone has inherited in a will. If there is an outstanding mortgage on the property, it is usually paid off through the deceased persons life insurance or other assets, so the beneficiary suddenly comes in possession of a home or piece of land at basically no cost. However, the beneficiary will have to start paying taxes and any other fees that are associated with that property. Unless the beneficiary needs the probate property, he is likely going to look at selling it.
Why would a person want to sell property that he inherited? The answer is usually because he has no use for it. In todays global economy, the piece of real estate may be in a completely different part of the country than where the beneficiary lives. Imagine an individual living in the state of Washington that inherits a house from his father who lived in Florida. In order to use that house, the beneficiary would have to move all the way to Florida.
This is usually not practical, so the beneficiary wants to sell the property quickly in order to benefit from it financially. Also, because the new owner is still grieving the loss of the person he loved, he usually wants to sell the property quickly to be done with the whole ordeal.
This is where probate investing comes in to play. See, a real estate investor can step in and make an offer on the probate property, and that offer can be quite a bit less than the property’s actual value. This is not being deceptive, because the beneficiary knows that making a sale quickly requires discounting the property.
This is simply good probate investing. The beneficiary will often take the discounted offer because he will be receiving income in one lump sum, without the hassle of putting the property on the market. The investor can then sell the property to an interested buyer quickly for a price closer to the actual market value, pocketing the difference as profit.
At this point you are probably wondering where you will get the money to buy the probate property with a lump sum payment. You know you don’t have that kind of money sitting in your bank account, so how can you get involved in probate investing?
The fact is that there are people all around you who want to increase their income through real estate, have the money to do so, but do not have the time or knowledge necessary to get started. These potential investors are often willing to let you use their money to invest in return for a portion of the income you make when you sell the property. The trick to getting them to invest in your probate property investment plan is presenting it to them in a positive way.
Now, the next question on your mind is probably how you can find these properties to invest in. The trick to probate investing is working quickly, which requires knowing where to look for properties before other investors find them.
Mike Kar is a real estate investor and mentor who has been helping people succeed in real estate investing and offers an infoproduct on real estate investing even if you have bad credit, no credit and no money.
Visit www.propertyforeclosureprofits.com
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