In our last post, we asked the Shakespearean-esque question:

… To flip or not to flip.

So,  you’re here.

Now what?

We will assume that because you are on Foreclosure.com that you are interested in becoming a real estate investor.

But, what kind of an investor do you want to be?

The great thing about getting involved with the real estate market is that there are so many different avenues you can explore.

Regardless of which direction you choose to go, the best way to start is to find property to buy below market value through our site. Whether you are interested in tax sales, bankruptcy sales, foreclosure auctions or bank-owned properties, buying “right

In our last post, we introduced the Foreclosure.com Flip Formula for Success.

Today, we’re going to break down all the factors that go into making it a helpful tool that can successfully guide you through the real estate investment process.

Let’s get started.

First, it’s important to establish a realistic re-sale value (RRSV) so that you will avoid having to market a property that is overpriced and takes too long to sell. It is a smart idea to price your flip 2-3 percent less than the competition. The attractive price along with the like-new appearance of your property should make for a desirable new home.

Next, determine the seller closing costs (SCC). Items like a brokerage commission (if you require the services of a real estate company), state stamps on the deed, possible buyer closing credit, prorated taxes, title search fees and any attorney fees are all possible expenses for which you need to account.

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To properly analyze the value of a potential flip it is a good idea to have a time-proven formula with which to work.

Adopting a successful formula and following it can help minimize the chances of being surprised by unexpected costs that eat into your net profit and turn a great deal into a money pit.

Far too often, an inexperienced investor will try to analyze a flip by taking the cost of the property he or she has purchased and adding the repairs and carrying costs to arrive at a projected re-sale value.

However, the re-sale price is not arbitrarily based on the amount of money that is invested in the property plus a sizeable profit. On the contrary, the re-sale price is based on comparable sales in the neighborhood that take into account the size of the property, its condition and amenities.

Here is an easy-to-understand formula that works for us:

Realistic Re-sale Value (RRSV)

minus Seller Closing Costs (SCC)
minus Debt Service (DS)
minus Repair Costs (RC)
minus Minimum Acceptable Profit (MAP)
minus Buyer Closing Costs (BCC)

= The X-factor: Maximum Property Purchase Price (MPPP)

We call this the Foreclosure.com Flip Formula for Success. Write it down and keep it in a safe spot, because you will need it one day soon.

In our next post, we will explain this formula in more detail and also tell you how it can keep you on track and under budget.

Whether it’s jumping off the high diving board or out of an airplane, these thrilling activities can create a sense of fear and anxiety. At the same time, however, they can also produce an incredible adrenaline rush that makes you want to do it over and over again.

Buying your first home or real estate investment is no different.

The process can seem daunting at first because of all the little things you need to know. But, the end result can be very rewarding both financially and personally.

Here are the three key ingredients to help allay your fear of the unknown and to ensure success in the real estate market:

• Preparation
• Investigation
• Education

Naturally, before you jump into the pool, it is a good idea to check the depth of the water so you don’t break your neck. Likewise, before you buy your first piece of property, you need to do your homework.

Surround yourself with knowledgeable people. Find an experienced local real estate agent to provide you with comparable sales in the area or do your own research with online resources such as Zillow.com.

Next, reach out to an experienced mortgage specialist who can explain all the different types of loan programs available to you. To make sure that you are not going to end up investing in a money pit,