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Chicken Little said the sky is falling. George Bush said things are great. Ben Bernanke isn't sure whether things are great so keeps lowering interest rates. Your friendly banker knows things are not great. Your above average Foreclosure Investor is buying foreclosure properties at prices that are phenomenally low and feels like this foreclosure craze is the start of something big.

Who is right? Maybe all of them and maybe none but I tend to side with the foreclosure investor. Not since the Great Depression has the housing market seen this many foreclosures and taken a hit like it is currently undergoing.

Great fortunes were made in the Great Depressions and greater fortunes were lost. The goal here is to be one of the winners not one of the losers.

Foreclosure investing is a skill that is quickly coming into its own as a legacy-building vehicle. By this I mean if you properly plan your strategies now you can be building wealth that will endure into the future. Opportunities like this only come about once in a lifetime. Being in a position to capitalize on it will make you on of the 'lucky ones' that comes out of this downturn with a big smile on your face.

In the last four to five years the mortgage industry has done a phenomenal job removing a huge percentage of the equity from the American housing market and converted it into three things. Vast amounts of cash, a huge quantity of very poorly underwritten loans and an enormous number of relatively worthless homes with negative equity.

Here lies the gold. It is waiting for you to stake your claim and start to mine it. These 'worthless' homes that everyone is complaining, about represent an amazing opportunity for the well educated foreclosure investor. The owners can't wait to get rid of them. They will literally give them to you for the asking. The thing is you don't want them at the current value of the existing loans.

Quite frankly, the banks don't want them either. So how can you turn this lemon into lemonade? The method is called the 'Short Sale'.

Although banks have been open to short sales for years it is only since the real estate 'bubble' popped that the process has become common knowledge. Before that it was the secret of a few select and very savvy real estate investors.

These investors were able to go about their work well under the radar. They contracted for homes with little or no equity and through short sales created one home run after another. You can do the same thing today.

Using a solid short sale strategy you can take a home that has thousands of dollars of negative equity and turn it into a deal with tens of thousands of dollars of profit.

What is a Short Sale? For the uninitiated a short sale is nothing more than the lender agreeing to take less than the outstanding balance of the loans on a property, as payment in full. He will then release the indebtedness created by the mortgage and a sale can take place.

Why would any lender take less than what is owed on a property? The answer to that one is easy. Industry estimates show that a typical foreclosure can cost a lender upwards of $40,000 and this does not even count additional expenses that can accrue if the property does not sell for an extended period of time.

The reason lenders do short sales is that they make good financial sense. It costs the lender less to take the initial loss created by the short sale rather than to go through the time and expense of a foreclosure proceeding.

The foreclosure investor can use this to their advantage and create equity in properties where none previously existed. Often there is no competition for the property and the investor can leisurely pursue their transaction without having to look over their shoulder.

You may wonder if short sales are such great deals why isn't everyone doing them. The reason for this is that short sales are not easy to do. They require time, patience and a great deal of technical expertise to do correctly. The packages have to be properly assembled, the parties involved have to be handled correctly, end buyers need to be found and financed and lastly the closings have to be orchestrated to get the transaction closed.

Many real estate people, both investors and brokers, have jumped on the short sale bandwagon. Many found out it is much more difficult than the $19.95 course they purchased said it would be. Thankfully, many of them are getting out of the short sale business. I highly recommend that those that want to stay in the field get themselves some really good education and training on the subject.

Being a professional in any field requires proper training and experience. This is not something that can be obtained from a two disc, 30 page course. It requires time and effort to be able to master anything, especially something as complex and convoluted as short sales.

In closing, let me say that by becoming a short sale expert what you find falling from the sky is not what hit Chicken Little but may be an endless stream of money flowing into your bank account.

If you found this article interesting and would like to learn more about foreclosure investing and short sales, visit http://www.whoisdickweiss.com or visit my blog at http://www.shortclosures.com.