When buying properties from owners who have taken them back, you'll have to overcome several obstacles. First of all, they'll always think of the properties as being worth the last price they sold at. They'll conveniently overlook the fact that they'd have never gotten them back if they'd been worth the debt that was on them. Let's face it. If they'd been worth more, wouldn't someone have bought them at foreclosure? Wouldn't the former owner have been able to sell them to the public. The fact that they have the properties back is a clear sign that they weren't worth what was owed on them.

Everybody - investors, fixers, landlords, wheeler-dealers, and financiers - who have taken the time to learn the business and to cultivate buying and selling skills can find a profitable niche to work in today's foreclosure market. Before you rush out to make your first million, there are some "don'ts" that you should observe if you want to avoid needless trouble and expense:

Those of you who are unhappy landlords probably can’t imagine having tenants who average over ten years of residency.  I’ve had two tenants who have lived with me over 20 years.  I’ve had a tenant pay for their house twice over.  I don’t work very hard.  I usually see the outside of my houses once a year when I make a cursory check to be certain that the exteriors are being maintained.  Good tenants get only token rent raises.  On the other hand, poor maintenance is rewarded with high rent raises accompanied by a note explaining why residents are going to pay extra for repairs and landscaping if they don‘t do it.  If they stay, my rent raise is a form of “paper training” to improve performance.  If they leave, they will have done me a favor.  Reflecting good and bad tenant performance in rents works wonders.  Even with $1000 annual rent raises, I didn’t lose any tenants because of the quality of the neighborhood where my rental was located and the freedom from interference I gave them.  Unlike many landlords, my houses are well maintained and even after increases, my rents are competitive.  Moreover, unlike many landlords, I treat my residents with respect as I would any employee.