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I am new and just starting out. Had a few ideas on getting started with REO's. One is to wholesale them. Does anyone have an experience with this? I have heard the secret with REO's is to keep making offer after offer.

Any advice is greatly appreciative.

I would have performance based clause in your contract with the contractor. For example, if the contractor says he can do the work in 2 months then give him 2.5 months and start deducting $100 a day for each day he goes over. If you can afford then I would include a bonus of say $1,000 or $500 dollars if he finishes the work ahead of schedule. It is worth the extra money so you can get on the market sooner.

Also add an addendum that includes all of the work that needs to be done and make sure you include that all changes or deviations need to be approved by YOU in writing.

The rural area would make me kind of nervous as well. It is all about the comps. Just make sure you have the comps to justify your fair market value. Kitchens an bathrooms are what sells houses. If this is a 6 bedroom house then you may want to include another bathroom and possibly combine 2 of the bedrooms and include a bathroom to top of the suite. Just a thought...

If you go with a HML then most are going to want a minimum of 5 to 10K down for your first deal.

I am just starting out and just can't quite seem to cross the line. Does anyone have any opinions on whether or not this market is saturated?

I am in Birmingham, AL and there are a few investors here. With the popularity of the shows on A&E, Discovery, and TLC I am afraid this market if saturated. Any thoughts?

Their holding costs are minimal because they turn around the properties in such a short time. They only costs they have are for utilities (Electric, Gas, Water, Sewage) and Insurance for month. Every show I have seen they have had the property sold and repaid the loan within 30 days and avoid interest payments. Speed and time is everything in flipping homes. You have to figure in holding and closing costs when you make an offer on the property. I do wish A&E would show these costs as well.

It really makes me wonder when this show was filmed because the housing market in Texas has started to cool off. If they are flipping properties in less then a month in this market then they are RE Gods in my opinion. I have heard some stories of houses that have been on the market for over six months!

That being said...the Montelongo's have motivated me to pursue REI as a career. I am new and just getting started. They prove that hard work and determination can have a great pay off.