Buying Foreclosures, REOs. Short Sales, FSBO, MLS and More

Hey all. New around here and interested in some of the practices of buying and selling properties. I really want to get involved and try to do something with my life.. and this seems like a good way to at least try!

I'm reading a lot around here and other various places to just soak in information. However it seems most of the savvy business people around here now have a lot of money to work with in their dealings... if I had a nice capital to get started I imagine things would be easier... but I really don't, I'm broke.

I have a question that’s more on the lines of an idea. I have heard Dean’s conference call about finding a motivated buyer and it was great because that was my main problem before I got started. My idea derived from the conference call to go in find foreclosures in my area knowing that the bank owns them and wants to get them off their hands so that they want have to pay the taxes or the bank already got another party involved to find a buyer.

I found an REO not too far from where I am now. From looking around in this neighborhood I can see that the comps for this property will be in the 245K to 292K range. The property is definately the ugly house on the block. All the other homes around this one are quite nice. I have not had an inspection on it but I do know that the water pipes froze up last winter and there is no heat now. This type of damage I am sure can be quite costly (I am going to call local contractors for estimates).

I am a new REI, and based on the techniques Dean teaches I have been researching properties for three weeks now.
Here's my question:
When I approach a home owner, who may be in distress and is agreeable to getting the property off their hands, what are the initial steps to getting the property "locked up" under contract.
I am thinking of a buy and hold stragegy here.

As an initial step, should I consider a promissory note as the tool to use,
or should I bring in a realator on my end and proceed to with a regular sales contract ?

Since I got on here a week or two ago it seems the overall strategy and theme in a down market is to buy pre foreclosures or REO's. My questions is, are these strategies good in every market or only in down markets? What are some of the popular strategies in an up market such as the one we had in 2004/2005?

I have located several boarded up properties listed between $5-$15K in a market population 70,000 with a median income in the 40Ks. I am basically broke, with no money to invest. Are these properties I should pursue or is there too much fix up money and turnaround time for someone basically a week into his real estate investing venture.

Finding and filing properties

Develop a system to keep track of properties that interest you. A good tracking system is important since most successful auction buyers pursue several properties sometimes over a period of several months.

Finding and filing properties

Develop a system to keep track of properties that interest you. A good tracking system is important since most pre-foreclosure buyers pursue many properties sometimes over a period of several months.

After you find a property online, it's a good idea to drive by the property to get a better idea of the property's condition and the type of neighborhood. For some buyers and investors, driving by the property facilitate a casual meeting with the owner or yields a wealth of unexpected information from a talkative neighbor.
Confirming pre-foreclosure status

Hey im just starting out and have not made any purchases yet. Im looking at making my first buy on a foreclosure on a home that belongs to a couple I know. The home is in pre-foreclosure not because the couple can't make payments but because the home was tied to a business the homeowners owned that sunk. Is there anyway I can obtain the property and sell it back to them? Or would I handle it no different than any other foreclosure and could I potentially rent it out to them and sell the property back to them on a later date? Any help is greatly appreiciated, Thanks.

Hi,