Welcome to the Usbankforeclosure Newsletter - May 2006

In this Issue:
1. Market Slow Down
2. Interest Rates
3. How to Purchase Foreclosures
4. Short Sales
5. Member Foreclosure for May 2006

Market Slow-Down

Real-Estate Slowdown Appears To Be Spreading Nationwide: There are signs of a housing slowdown that has gripped certain high-growth markets during the past few quarters, is now spreading nationwide. Read More

Interest Rates

The Federal Reserve raised short-term interest rates to 5%, and said it may raise rates further, but whether it does so will depend on incoming economic data. The quarter-point increase in rates, the 16th consecutive quarter-percentage-point increase since June 2004, was widely expected. The accompanying statement opened the door for a halt to rising rates for the first time in two years, while not discarding altogether the prospects for more increases.
"Some" increase in rates "may yet be needed to address inflation risks," the Fed said, adding the word "yet" to its March 28 statement. It added: "the extent and timing of any such firming will depend importantly on the evolution of the economic outlook." Read More

How to purchase Foreclosures

Join our member network and we'll show you how to purchase foreclosures for wholesale prices. Why would you pay retail when you can pay wholesale for an investment property? Learn from other members that are actually negotiating these transactions and either reselling or renting them out.


What are Short Sales?

As the real estate market starts to slow down the experienced investor will shift from buying foreclosures at the courthouse steps and negotiate a short sale with the bank that is foreclosing the loan. These types of purchases can be extremely rewarding for the investor. Let's look at an example: Mr. Smith is in Foreclosure and has a pending sale date within 30 days. The investor contacts Mr. Smith and starts a short sale with the bank foreclosing the loan. Mr. Smith owes a total of $150,000 on the loan including legal and late fees. The house has a fair market value of $175,0000. Therefore, the only way the investor can really make money with this deal is to short the loan. The investor submits a package deal to the bank for $100,000 and a closing scheduled in 5 days. You'll be surprised to discover the bank will accept the offer. Now the investor has substantial equity and can either resell the home or rent it. Even if the market shifts by 20% the investor is protected and can make a profit. Join our network and learn how to perform short sales.

Member Foreclosure for May 2006

This 4 bedroom 2 bath house was purchased in New Jersey as a pre-foreclosure. Our foreclosure investor purchased it directly from the homeowners that were losing the house. This deal put together in about 7 days which was just enough time to stop the foreclosure sale. This investor used hard money to come up with $180,000 in order to satisfy the mortgage. The hard money cost him $25,000 and another $5,000 for legal & closing fees. He also provided the family with $10,000 check in order for them to relocate and start their life again. The investor will need to put another $35,000 worth of repairs to the inside, New Kitchen, 2 new baths,

finish the basement, paint the interior and landscape the property. Let's do the math: $180K + 10K + $25K + $5K +  $35K = $255,000 total expended.  The house will be listed with a realtor for $375,000.  The investor worked out a 5% realtor fee which would be $18,750 and closings costs approximately $7K.  Therefore, the total potential profit for this project is $94,250!.....Not too bad for a total projected timeframe of 5 months and only $45,000 of his own money.  Join our network and learn how close these types of deals!