How to choose profitable lots at a bankruptcy auction

Choosing a profitable property at a bankruptcy auction will help each bidder avoid serious financial losses.

You will need

• - attentiveness

• - caution

• - logic

Instruction manual

1

Rate the liquidity of the lot you found at the bankruptcy bidding. The simpler and easier the lot purchased at a bankruptcy auction can be sold, the more liquid it is. At the bankruptcy auction, there are enough both liquid and illiquid lots.

2

Estimate the purchase price and the projected sale price of the lot found at the bankruptcy auction. Starting investments and capital gains should differ significantly from each other. The capital gain is required to compensate for all starting investments in the lot, overhead costs for finding and buying a lot, as well as the loss of time for analyzing such a lot.

3

Consider competition in bankruptcy bidding. The lower the price of the lot, the higher the competition. You do not need to wait for a strong reduction in the price of a lot if the price is initially set low. Be more original, choose lots that others bypass.

4

Buy objects with burdens. For objects with encumbered prices are significantly lower. Most bidders bypass such objects because they don’t know how to remove encumbrances from the object after buying a lot. Hence the competition for such objects is extremely low. Having mastered the algorithm for removing encumbrances from such objects, you can get a great competitive advantage over other bidders and earn good money.

5

Consider the region of purchase of the lot. Look first at your region, then neighboring regions and, most recently, distant regions. Buying a lot in your region, you can significantly reduce overhead when buying a lot and minimize other commercial risks.

note

There is no universal approach to selecting and evaluating a lot at a bankruptcy auction. As you practice buying lots, you will have your own filters and approaches in choosing the most profitable lots for you.

Useful advice

Choose lots from narrow niches at the bankruptcy auction where competition is extremely low.