If you've been looking into the idea of making money in real estate by buying foreclosures, then you may have come across the idea of buying pre-foreclosure. Basically, pre-foreclosure is the period when the buyer is behind on payments, but the lender has yet to auction off the property. There's a good and bad side to buying in pre-foreclosure, so let's take a look at both.

When someone is facing foreclosure, they're often very motivated to get out of the mortgage completely. This gives you a good opportunity to buy the house for little more than the cost of taking over the mortgage payments. There are thousands of foreclosures advertised every month, so if you do your research or subscribe to a listing service, you can simply do drive bys and then approach the owners of properties you're interested in buying.

The downside is that properties are only in pre-foreclosure for about three weeks, so you need to be quick. In that time you have to contact the owners, get contracts signed, organize finance and anything else that needs to be sorted out. It's important to realize, too, that you're not going to be dealing with level headed, logical owners who realize that it's to the benefit of their credit history to avoid having a foreclosure listed there. It's much more likely that they'll be angry at the world in general, under a lot of stress and receiving numerous calls from debt collectors. They're not likely to greet you with enthusiasm and open arms.

It's also possible that the homeowner will find a way out of their situation before the courthouse auction occurs, in which case you may spend a lot of time putting together a deal that doesn't happen.

If you're serious about buying pre-foreclosures, then you need to let people know you're there as an option. Design a bold, eye-catching flyer that you can send or give to the house owners, and make sure it's motivational enough for them to call you. At the time you're trying to contact the owners they're probably overloaded with debt collection notices, so you need to make it clear you're something different. Stand out, and contact them more than once if necessary. Vary your approach, rouse their curiosity, and make sure you come across as someone who can help them, not just a pushy person wanting to make money out of their situation.

Buying pre-foreclosures isn't for everyone - you need to take action quickly, be diligent in doing your research, and be able to handle rejection, a lot of which will be nasty and unpleasant. It's important to keep on top of new listings, because the sooner you can get to an owner in pre-foreclosure, the better your chances of success. So spending money on a listing service will pay off in time saved. If you can handle all the different elements, pre-foreclosures can be a great way to build your real estate investment portfolio very cheaply.

More info on your stop foreclosure information search:

Get Free Foreclosure Advice and Free Refinance Quotes
Get your free on-line foreclosure refinance quote and free advice from foreclosure mitigation specialist in minutes. Compare real offers from top national subprime and hard money lenders... more...

Buying Foreclosures: Can You Really Make Money Buying Foreclosures?
We have all seen the late night infomercials featuring the guy who bought a foreclosure for $40,000 and sold it a week later for $75,000. These stories can certainly get people excited. Considering the costs involved and the associated risks, can you really make money buying foreclosures? Let's ... more...

Three Strategies In Buying Foreclosures
The strategy of buying pre-foreclosures is to create a situation where everyone wins. This type of strategy involves just you, the homeowner, and in some cases the lender. Because the homeowner has been delinquent on his or her mortgage payments, they are now in a position to entertain offers made ... more...

Overview of Buying Real Estate Foreclosures
Buying foreclosures can be extremely profitable for real estate investors. It means that you need to be aware of local laws and how they may affect the ownership of a property. Buying below market value with no money down is easy, you just need to know how to do it. You can usually purchase a ... more...

Repossessed Foreclosures - How to Buy Them Dirt Cheap
Foreclosures happen. They are unpleasant, but they are a part of life. But did you ever think that a repossessed foreclosure might benefit you ? Buying dirt-cheap repossessed foreclosures is actually a good way to earn some extra cash - and a lot of it. Buying dirt-cheap repossessed foreclosures is ... more...