Foreclosures continue to surge, with more than 280,000 homes prey in August according to Foreclosures.com. Homeowners are wrestling with payments they’re having trouble making which only means the opportunities for investors are now better than ever. Let’s take a look at some possible questions the uninformed investor might have.

Should I go for an REO or a foreclosure? If you’ve never invested in foreclosures, strongly consider pursuing an REO (real estate owned) property. Most importantly, you’ll be able to physically see where your money is going which is not possible with foreclosures and you won’t have to compete against ferocious investors who’ve already sharpened their fangs when it comes to foreclosure auctions. On top of that, you’ll also prevent potential liens in the long run by receiving a title insurance policy.

How do I commence? There’s no definite way to go about it. Perhaps you’d like to speak directly with a lender to find out what they have available or you might want to consult a third party such as a realtor familiar with the innards of foreclosures. If you’re not comfortable taking such a direct approach, explore listings through the MLS.

Am I going to be bamboozled? It’s always good to do your homework before going tête-à-tête with a lender so you know you’re getting a fair deal and always bear in mind that you’re probably already getting that property for a cheaper price than what it would have cost had it not gone into foreclosure. If you’re persuasive enough, you may find lenders willing to take a significant loss on their end, especially since they have more properties now than they know what to do with.

And lastly, make sure you don’t end up with a property that requires a laundry list of repairs that go beyond the price you originally negotiated. Oftentimes homeowners who couldn’t make payments didn’t have the time for any upkeep either as you may quickly find out.

Is credit a requisite? Foreclosures are ineligible for insurance and, as mentioned above, often need to be restored so the quick answer is yes, it is. However, if you do some legwork, you can find outside investors and other third parties who may be willing to assist you in terms of using cash.

The market is in shambles. Why would I want to pursue foreclosures now? Again, lenders have a massive oversupply of foreclosure properties that they’re practically scrambling to get rid of which only means you’ll be able to snag properties at prices that you would not find if the market were in better conditions. Despite the market’s unfavorable status, real estate still remains one of your best bets in reaping long term rewards.