Michigan Foreclosure Report by Mark Ijlal

You make your money when you buy. Ijlal Inner Circle member Glenn Carr just bought a foreclosure in Oxford, Michigan – which is a great little suburb in my very own Oakland county. Here are the pictures:

Here is the email that he wrote with the pictures:

Mark, Sorry I missed the meeting last night, but I have some good news to share. I've purchased a house in Oxford for 120K, and the house will need about 5-7K of work. The history on the house shows that the home was sold in 2004 for 202K and was refinanced in 2006 for 210K, lastly zillow estimate indicated that the house is worth 186K. So, we are please to know that we have between 65K to 80K in equity!!! As it's been stated many times before you make your money when you BUY, and this old adage still holds true. Take Care Glenn Carr

Here is what deal is a such a beauty:

1. If you can get equity like this – it gives you lots of “wiggle room” to sell the house. I have said it over and over again that the difference between everybody selling houses in Michigan and the Michigan real estate investor who know what they are doing is one word – EQUITY. We have what almost 100% of all other homeowners in Michigan don’t have anymore – EQUITY.

Why EQUITY still makes the world go round? Because you can run some crazy promotions to sell your house fast; you can make “mistakes” doing your first deal and there is still money left; there are lot of money sources who are excited about giving you money despite what your credit report looks like; if you don’t want to do the whole deal then you can take a partner or wholesale flip the house – the list of options goes on and on.

But it all starts with what you buy and what price you buy the foreclosure at.

2. Despite whatever you have heard or think to be true – there is no shortage of foreclosures in Michigan – what has always been in short supply is actually people who do something with the ones that are available.

Case in point this house was available, in plain sight to anybody who was looking to buy one – but no body stepped forward, armed with the knowledge to make the deal without using any of their own money but Glenn.

3. This house is being bought and rehabbed without investing any of Glenn’s money. Despite what you have heard about hard money lenders in Michigan the game has changed and there are lots of new things happening in the OPM in Michigan. There are programs coming to the market even from mainstream players that are making seasoned investors jaw dropped. I mean gee where were these guys 5, 6 years ago when we are hustling to put houses on our credit cards.?

4. There is a term in commercial real estate that I like a lot – it is called Build To Suit – you might have seen that sign displayed on roadside lots etc where the owner of the land is perfectly willing to actually build you a building to your likings as long as you are able and willing to commit to a long term lease with them. The owner gets the security of getting a quality long term tenant. The buyer gets something that is just made for them.

The business of buying and selling bank foreclosures circa 2007 is really a Build To Suit business. Meaning that it is up to you what you want to do in the world of Michigan foreclosures. If you want to fix house like my Inner Circle members Alan Boike, Blaise Dietz and Rita Dalian like to do – well that could be arranged pretty easily. Tons of houses with rehab ranging from $15,000 to $40,000 even $1000,000 available in every city in Michigan.

But if you are new to the game and don’t want to do rehab – well you can go and find houses like the above one where your expense to make the house look spiffy is less than $7,000. Which by the way as a good rule of thumb for your first 3 deals unless you have previous experience you want to keep your rehab budget under $20,000 preferably under $10,000. But that is only true if the deal is a true killer. Otherwise look and look again – you can find houses like Glenn did that require paint, cleanup and cosmetic changes and you are good to go.

Build to Suit is a wonderful word and in February 2007 it is in full swing and available to those who want in Michigan real estate. Want to fix houses; don’t want to fix houses; it is ALL UP TO YOU to decide what you want to do, what you like doing and build a business in Michigan real estate around it. Glenn took some initiative - got a good deal. Could have been you...

My Schedule Update:
If you want to learn “where” to go in Michigan and “how to buy” these kind of deals without using your own money then check out the upcoming Quick Start 2007 Bootcamp on March 30, 31 and April 1 in Troy, Michigan. As usual small group (10-15 students) ; just me teaching; no outside speakers. You will have a blast. It is 100% risk free enrollment - details and a $100 Early Bird St.Patricks Day discount are here.