When a foreclosure property becomes available because of the death of the borrower, the acquisition can be entangled because of surviving family member squabbles. Heirs might suddenly think the property is worth far more than anyone would ever agree to pay for it. Often it takes only one family member with a differing opinion to stop a sale from proceeding.

In other cases, the family members might be just as willing to get rid of the property as quickly as possible. The decedent's estate may be anxious to dispose of the property because it is costing money each month, and they want to stop these expenses. For this reason it pays to pursue foreclosure properties in probate. Don't hesitate to contact the estate of any foreclosed property. Understand that you might have different problems to close on the property.

In the last chapter you learned how to determine the value of a property. Your opinion of the value may vary greatly from the property owner. Defaulting borrowers often think their property is worth a lot more than it actually is. Perhaps this is because they are in denial of their deteriorating financial condition. Obviously you need to work from your opinion of value and not theirs.

As you consider making offers on foreclosed property, there must always be a margin of profit to you. The margin of profit you want to make on each deal is your personal choice.

Don't focus on a specific percentage before you will make an offer. If, for example, you determine the value of a property to be $150,000, don't disregard the property because you can't make 25 percent on the deal. While a profit of $37,500 would be a great payday for you, suppose you could walk away with $20,000. Would you really pass on that deal?

If you set the goal of making $20,000 per deal and could do two deals per month, consider what your annual income would be from investing in foreclosure properties.

Remember also that without the potential for profit there is no reason for your pre-foreclosure or foreclosure investment. The defaulting property owner needs to understand this too.