That's up from about 150 investors who were responsible for about 350 foreclosures two years earlier, according to a Houston Chronicle analysis of data provided by The Woodlands-based Foreclosure Information & Listing Service.

Although it's unclear how big a factor the novice investor is in the current market, it is clear that defaults among multiple homeowners contributed to a 44 percent increase in foreclosures in Harris, Montgomery and Fort Bend counties. Foreclosures shot up to 11,983 in 2006 from 8,300 in 2004.

"Unsophisticated investors always make mistakes because they speculate instead of buying something that's a good investment," said Del Walmsley, president of Lifestyles Unlimited, a real estate investor and mentor group in Houston. "They go out and buy anything."

Some investors looking for rental income have been drawn to condominiums as apartments converted to condos and newer units hit the market in recent years.

But unlike in more dense cities, condos in Houston are generally difficult to rent, noted Walmsley, president of Lifestyles Unlimited.

Here, potential tenants can usually pay the same or less rent to live in an apartment with many amenities or even to rent a house, he said. It's hard, he said, to charge a rent in Houston that's high enough to cover monthly mortgage payments and maintenance dues.

Another reason condos sometimes end up in foreclosure is because investors try to sell them to individuals when often "they're really just glorified apartments," said Rickey Williams, president of Homevestors WFI Properties in Houston.

"They're converted apartments. Would you rather go to an upgraded apartment complex or an older one that's been turned into a condo?"

Williams said he gets lots of calls from investors trying to sell their condos to him, but he won't buy because he doesn't think they're good investments here.

Big houses a problem

Large homes can also be a problem, Walmsley said.

"Big houses aren't going to rent," he said. "If you're an investor and don't know that, you're going to load yourself on houses you can buy well below market. Problem is, they won't rent, so they get upside down."

A growing availability of condos for sale is not all that's catching investors off guard. Some can't keep up with their homeowner association fees.

At Candlelight Trails in northwest Houston, for example, the homeowners association foreclosed on 22 of its more than 240 units in 2006, according to the listing service.

All of those foreclosures resulted from nonpayment of monthly maintenance fees, said Shirley Gonzales, who sits on the association's three-member board.

Gonzales, who also owns investment property in the complex, said many investors can't afford the average monthly dues of $250 because they can't find steady tenants to live in the community.

While the board has debated who is responsible for the lack of tenants, some investors haven't stuck around to see who wins the argument.

Jack Lyell, 70, isn't sure who to blame, but he lost two units about two years ago, which he had bought for $10,000 each, when he could no longer find tenants.

"I couldn't keep them because I couldn't afford them," he said. "I had a few thousand in maintenance fees accumulated and they took them. I would have loved to have kept them and turned them around."

Questionable investments

Many first-time investors lost their properties after getting entangled in questionable deals.

The problem has become so pervasive in Houston that the FBI has created a special unit here to crack down on mortgage fraud.

In January, the Harris County District Attorney's Office indicted eight people, from real estate agents to loan officers, in connection with alleged mortgage fraud that entangled 300 homes worth more than $40 million. About 70 of those homes were in ZIP code 77004 just south of downtown. Others were concentrated in Missouri City.

Chris Robison, 39, said she recently filed a complaint with the FBI claiming she got lured into buying a house in Pearland and a condo downtown that were doomed investments from the start.

"I signed the loans. I didn't know what I was doing," she said. "Now my credit is ruined."

She said she agreed to buy two properties that others had promised to manage, rent and eventually sell for a profit that they would split. They would even make her mortgage payments.

All Robison had to do was sign the loan papers, she said. So she did.

But eventually she began to get default notices in the mail, the homes were foreclosed, and her credit score of 667 had plummeted. The homes she bought for a total of $942,500 were 100 percent financed, leaving her with thousands in monthly payments she couldn't afford.

Unfortunately, she didn't read the loan papers thoroughly before she signed them, said Robison, who provided the Chronicle with the documents. Her loan applications, she said, state separate monthly incomes inflated by thousands of dollars and stated she would be living in the two properties — factors lenders look at when approving loans.

"I just trusted these people. I didn't read anything," she said.

Force of nature

Some investors find themselves overwhelmed when life, or nature, takes them by surprise. This is a perennial problem that undergirds all fraud and tough markets, the experts say.

Kenny Morris, 37, bought 12 units in Kashmere Gardens in 2000. He planned on renovating them and renting them out. But when Tropical Storm Allison hit in 2001 and flooded the properties, Morris didn't have flood insurance. He had to take out a loan to repair the homes.

On top of that, he had trouble getting tenants to pay their rent, ultimately forcing him to lose the properties to foreclosure last year.

"It surprises me how some people figure they can live for free," he said. "Dealing with tenants that won't pay — it's costly. You have to go to court and file and pay for it. I just don't have that kind of a bank account."

Getting back into it

Morris wishes he'd gotten rid of the properties before the flood but says he's learned a lot in the process.

He eventually wants to get back into investing, but in the meantime he's studying to get a nursing license. "I want to do something different and not be dependent totally on my job for income," he said.

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