ForeclosureProfits
Tips on How To Keep Them

The Easiest Way To Keep Your ForeclosureProfits is to learn the tricks to reduce labor and materials costs, so you can put more profit in your pocket. Here you will find lots of money and time saving techniques.

What is lacking is the support to assist you in the event there is a problem. In a traditional purchase the analysis is based on comparable properties. Due to the use of an attorney or closing agent, title insurance, escrow accounts and inspections, it creates a system of checks and balances to ensure the buyer is not cheated and the seller is disclosing information.

In a foreclosure purchase these checks and balances are, in many cases, not available and determination is by your own judgment. As an example, you will not have access to the home prior to the auction for physical inspection unless granted by the owners. Most homes you purchase will need minor repair. We typically budget, $10,000 per home but spend about $6,000.

This amount is based on our doing the work ourselves or through our network of contacts. It is always a given that you will need a roofer and someone to install carpet and tile. Doing roofing and flooring installation yourself requires a lot of time and these things are frequently the first things noticed if done poorly. Nearly every home we have purchased needs: carpet, tile, appliances, drywall repair, painting and most need roofing.

ForeclosureProfits Tip on ROOFING

Depending on your area of Florida, you may be able to obtain an owner builder permit for roofing and other projects but usually not for plumbing or electrical work.

ForeclosureProfits Note:

Most smaller electrical and plumbing jobs can be done yourself without permit, but if replacement of an appliance is necessary watch out. We have been fined for not obtaining permits when replacing water heaters because we left the old one on the back of the truck or on a trailer in front of the home. We have also been approached at the dump when disposing of an old water heater or a/c unit. Also, when you sell the home the disclosure you sign will ask if there has been any work performed which was conducted without a permit.

We normally hire day labor to support our roofing projects. We supply the materials, they supply the labor and at least one of the laborers is experienced. While it is normal to pay a contractor $200-$300 per square ( a square is a measurement of 100sqft) to supply materials, labor and a permit for a shingle re roofing we can typically do it for $90-$100 per square. On the norm of our foreclosures purchases being 1500sqft under roof and shingled, we will spend around $1500.

ForeclosureProfits Tip on FLOORING

We also have a contract for labor to install flooring, we supply the flooring and they supply non flooring materials such as adhesives, tack stripping and metal edging. One ways to save is to order the flooring from one of the outlet sellers in Georgia. We see substantial discounts because we purchase by the roll and pick it up ourselves. A typical roll of carpet, depending on type, is around 1500square yards. We find that a roll of carpet is usually adequate for 3 homes, being 1500 square foot with 3 carpeted bedrooms, a hallway and living room. For FHA grade carpet, by the roll, we expect to pay about $3.75 per yard. (FHA grade carpet is the minimum standard FHA allows for carpeting in a residential home which they finance). You too can find bargains, even if you are buying in smaller quantities.

ForeclosureProfits Tip on Flooring Dealers

Dalton Carpet in Calhoun, Georgia is our supplier. Dalton is a supplier, manufacturer and distributor of laminate, wood, carpet and vinyl flooring. Mohawk and Shaw Carpet Mills also have manufacturing and distribution operations in Calhoun as well. The same FHA grade carpet in our local area is around $8.00 per square yard while we are paying $3.75.

ForeclosureProfits Tip on APPLIANCES

Saturdays and Lowe's go together like peanut butter and jelly. Lowe's typically places their discontinued, clearance, open box, scratched and floor model items on the floor on Saturday morning. Lowe's will also negotiate on these items.

We normally save $200 or more, per appliance, by negotiation. If you find something of interest, out on Saturday morning as one of the above mentioned items, ask for further reduction. Typically the floor staff will say this is a great buy, your already getting 10% off, etc. If they are unwilling to further reduce the price and you are buying multiple appliances ask for the manager.

Be sure to point out any small appliance defect, I noticed its scratched or last of the floor models, "Is there any way to discount this a little more?" You will be surprised how frequently they say yes. If the answer is no, Lowe's and Home Depot managers naturally despise each other, inform the manager that you have found the item cheaper at Home Depot but it is farther for you to drive and you normally prefer to shop there. Lowe's and Home depot offer a 10% discount if you find the identical item elsewhere for less.

In our area Lowe's is usually cheaper than Home Depot and isn't as quick to negotiate a price.

ForeclosureProfits Tip on MATERIALS

Shop around, there are big differences in prices between the large retailers. The price difference, while only $3.00 per 5 gallons of joint compound really adds up when you buy hundreds of gallons a year. A thousand 2x4 wall studs a year adds up when there is a $.40 price difference per stud. We purchase all our paint brushes and rollers at Big Lots.

ForeclosureProfits Tip on PAINT

Walmart is the best interior paint around, we use flat for its superior coverage and excellent price. Lowe's and Home Depot always have discounted paint that was tinted the wrong color and returned. We buy these in light colors to use as an undercoat. When you have a room that was dark blue, it will take several coats to cover it. Instead of using several coats of Walmart paint we will cover it with cheap returned paint and the final coat will be the color we want.

When the house exterior is in need of pressure cleaning and will require a primer, we use the cheap returned paint as the primer. It saves money and the paint wears about the same as using the primer. Word of caution, mix all of your undercoat colors together before painting. If you don't the final color will look uneven.

ForeclosureProfits Example:
you estimate it will take 3 gallons of paint to cover your blue room. You buy 3 different color returns from Home Depot. Mix them, then paint. With each paint being a different tint, if you use a gallon then start with another your final coat will definitely be different shades. You don't want to waste money and time doing multiple coats of your final color. If the final color is off slightly, its not a big deal but if it shows as different areas of wall being darker than others its got to be repainted.

ForeclosureProfits Tip on LIGHTING We frequently buy light fixtures at Sam's Club's Auction site and get them at 50% off the retail price.

ForeclosureProfits Tip, Sam's Club Auction

ForeclosureProfits Tip on RE MODELERS

We purchase kitchen cabinets from individuals and small companies doing remodeling projects. Some real bargains can be found. The best place to look is in the newspaper.

Individuals frequently disregard old kitchen cabinets that only need some stain or paint. Professional remodelers don't want the hassle of storing these items. We will go in and remove the old cabinets for free, in exchange for the cabinets. To some, this equates to thousands of dollars saved by not paying the contractor for the removal and disposal of these items. We have obtained granite counter tops, stainless sinks and oak cabinetry for nearly nothing. When you see an ad in the paper from individuals selling kitchen appliances call and ask if they are remodeling the kitchen. If yes, ask about the removed cabinets.

There is only a few standard size kitchen cabinets, so use what you find for cheap and purchase similar cabinets from Home Depot and stain them or paint them all the same color.

ForeclosureProfits Best Money Saving Tip

Buy a pressure cleaner and a paint sprayer. These two items can save you tens of thousands of dollars over their life time. A pressure cleaning company could come out and charge you $200 for a driveway or do it yourself in 1-2 hours or have day labor do it with your pressure cleaner $20.00 per hour. This adds considerable curb appeal.

ForeclosureProfits Example:
A patio deck is a great example, pressure clean, then spray the stain on with a paint sprayer. It saves a lot of time and money, even if you use day labor. For a 500sqft deck it may take all day to paint with a brush and roller versus 1 hour with a paint sprayer. I can spray 2 coats of stain on a 1200 sqft deck, cover all the necessary plants and put plastic sheeting around the base of the house in less than 2 hours. To have a professional painter come out could easily cost $500 while doing it yourself costs $75 or day labor of $150. A pressure cleaner and paint sprayer will put profit in your pocket.

ForeclosureProfits Painting Tips

Cover with plastic sheeting all the windows, light fixtures, fans, cabinets and fixtures, and flooring you don't want to replace. Take out your paint sprayer and paint the entire interior of the home with one color, we use antique white. Don't paint all the way to the ceiling, a little over spray on the ceiling isn't noticed. When dried, load up your trim color for the interior doors, baseboards and closet shelving, pick a trim color that is close to the antique white, we use high gloss white. Go through the house and paint all those. When dried, use a roller to repaint areas affected by excessive over spray of the trim color. Don't be a perfectionist, no one will care or notice. This saves an incredible amount of time and on a 1500sqft home we can usually have the interior and exterior painted in one day. We typically find it takes two people 2-3 days to paint a home interior and exterior by brush and roller versus 1 person 1 day by spraying.

ForeclosureProfits Note: If your interior trim and wall colors are drastically different, don't spray the trim color. The over spray from the trim color will show up everywhere.

If the exterior also needs painting, while waiting for interior walls to dry start spraying the exterior wall color. When exterior walls are drying go inside and paint the trim. We don't spray on the accent exterior color. This color is typically much darker than the wall color, so covering the over spray would be a pain. If the home requires more than one coat, it may take 2 days. A few years ago we sold a home to an interior painter who informed us it would cost about $3,700 to paint the interior and exterior of the home, our cost is normally $400. Not a bad return for one days labor with a paint sprayer.

Once everything is dried, we will then go back and paint the accent colors. Maybe one wall will be a bright vibrant color or we may repaint the kitchen red or repaint the exterior of the front door. All in all, we get high marks for our painting and color choices, while saving thousands of dollars.

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The information found here is my opinion and should not be interpreted or construed as legal or professional advice. No legal or professional advice is being given and the use of this information is at the readers own risk and peril. It is advised that those considering this investment should seek qualified legal and professional services.