Late last week, I got a probate mailing list. For my county, there were just over 100 people on it in the last quarter. So, it is a relatively small list compared to the thousands of postcards I might send out to Absentee Owners or other home owners in my market to purchase properties.
Earlier this week, I put together a personalized letter and get a mailing out to this list to offer to purchase any houses they may be interested in selling. With most mailing lists I would send a postcard (or hand written yellow letter in some cases), but with this particular list I am trying something a bit different based on the recommendation of the company that I got the list from.
They recommend a personalized, typed letter with a hand address envelope so that is what I will use as the baseline to compare future tests.
The feedback I have gotten in the past is that the probate mailing list is typically an extremely responsive list. We will see how this particular mailing goes.
Until my next post,
James
There are lots of different strategies for investing in real estate from short sales to pre-foreclosures to REOs and other bank owned properties to lease options and on and on. My personal preferred strategy is to focus on finding high equity properties and start with a offer that asks the seller to accept a note for their equity.
So, if you are working with real estate agents and brokers to help you find deals then here is how I suggest that agents find potential deals for me.
First, there is a HUGE variety of agents with a very wide range of unique experiences, beliefs, knowledge levels, work habits and personality types. Not every agent is a good match for working with me and I suspect not every agent will be a good match for working with you.
Some agents when I first tell them what I am looking for think they should look in their MLS for properties that list “owner financing” or “owner can help finance” or “seller financing”. Experience shows that this is the wrong approach. The overwhelming majority of sellers advertising that they will accept owner financing are investors like me that are selling on a rent to own or would consider a land contract. Are there exceptions? Yes, but go ahead and test this yourself and you will see that most are not good fits for how I buy.
The preferred way for agents to find potential deals for me involves two steps:
First, if the agent can look up approximately how much is owed on the property (the majority of areas you cannot get good data for this but you can roughly estimate based on lien data from public records). We are looking for properties that are likely free and clear or have very low loan balances. Many agents when you tell them this is what you want, tell you that all the properties in their market are foreclosures and that there is no one like this. I strongly disagree… one third of all properties in the United States are owned free and clear (see this compiled summary chart).
Second, and this is probably the most common way, is to call the listing agent and tell them something like this:
I have a serious buyer who is interested in a single family home like your listing, but he is only interested if they seller would consider accepting a note for their equity if he puts up a down payment. Is this even something your seller would consider?
Some agents will “build up” their buyer (me in this case) to make it more attractive. That can help, but its not required.
Some agents will try to guess terms, interest rates, how much down and so on… don’t bother. It doesn’t matter, at this point, what the seller thinks they want because the property actually dictates how much monthly we can pay (Net Operating Income). All you are doing is pre-screening to see if it is something they’d consider.
Once that happens, the agent should call and provide full info on the property for us to do our offer analysis and make an offer.
I hope that helps you understand how I work with agents to find deals for me.
Until my next post,
James
P.S. To learn more about my strategies and how to implement them in your business, upgrade to our Real Estate Investor Bronze Membership today.
Whether you are just starting as a real estate investor or an experienced veteran, it is often helpful to eaves drop and listen in as another investor talks to motivated sellers. Today, I am going to share with you some very basic tips on how to talk to motivated sellers and share with you some resources I have available for doing more of that.
First, whenever you are talking to motivated sellers and that includes on the phone and in person, I strongly encourage you to use a script. On the phone, it is usually the Property Information Sheet (links for Real Estate Investor Bronze Members that are logged in) as your trigger of what to ask. When in person, I strongly recommend you use an in-house presentation binder to make a formal presentation. We call ours the Seller Presentation.
This week I am giving away training I did with an employee I hired who was making these calls for me. If you want to download it, you can download it here: Real Estate Investor Daily Training Volume #1. It will be like me training you on how I would have you make the calls to my motivated seller inquiries. Of course, you can then adapt them to your own business and personality.
Third, professionals practice off the field. You don’t practice on real sellers. You practice in front of a mirror and/or video camera making a pre-planned, written presentation. Your presentation should be essentially the same each time (with minor variation depending on how certain questions are answered). If you insist on throwing money away and practicing on live motivated seller prospects, why not throw $20 bills out of the window of your car on the way to talk to them. It really is the same thing.
Fourth, I do have two additional audio training CDs on talking to motivated sellers. Each one has a separate roll playing call to a motivated seller and then a full analysis of the call for you to understand why I say certain things and what I am thinking during the call. If you are interested in those, Real Estate Investor Bronze Members can download both of them for free with their membership.
With the information you have have above… and A LOT of practice… you should become very good, very quickly with talking to motivated sellers.
Until my next post,
James
If you are relying on just one marketing methods to get new clients into your business, you’re doomed to failure. While there probably are exceptions to this business and marketing rule, for almost all businesses–including businesses that serve the real estate industry–it is definitely true.
There is a great story that Dan Kennedy teaches and I’d like to paraphrase it here. There is a doctor who moves to a new town, starts a new medical practice and grows it from nothing to a thriving business with tons of clients, then sells the business and moves on to do it all again. So, finally some of his doctor friends ask him, “what’s the secret to getting 100 new clients every month?” And he replies, “I don’t know one thing to get 100 new clients every month, but I do know 100 things that will get me one new client and I do all 100 of them!”
While I don’t know if the story is true or not, but it doesn’t matter because the lesson is clear. There are hundreds of ways to get new clients in ANY business yet many business owners stick with just a few and wonder why their businesses are not exploding with new clients.
So, if you really want to build a business that will stand the test of time and one that will give you the lifestyle you want today, you need to massively increase your marketing and start implementing new… automatically recurring… methods of marketing that will get you new clients consistently each month.
Until my next post,
James
P.S. Want to learn of the most effective ways for generating calls from sellers who want you to buy their house? Upgrade to our Real Estate Investor Bronze Membership today.
In my last few articles, I discussed how buying a house subject to the existing financing is similar yet different from leasing a house with an option to buy. I talked about how one is not necessarily better than another, but that each has its advantages and disadvantages depending on what you are trying to accomplish.
Now, I will share with you a strategy for making an offer to buy a house subject to the existing financing where the similarities between “subject to” and “lease options” are used to make a stronger, more understandable offer to a seller.
First, you might suggest in a trail close something like this: “I’m not sure if I can buy your house for that price, but would it help you at all if you did not have to worry about making the payments any more?” Motivated sellers usually reply, “yes, that would really help.” If you don’t get that type of response you might not be dealing with a motivated seller.
If they ask you what you mean you might say, “well, I could make payments to you for the amount of your loan while I am selling the property if I decide to purchase the property from you. Might that work for you?”
So far, you could be talking about either a lease option or buying the house subject to in the example. How you actually structure it can be discussed on the paperwork. In a future article, I will be discussing some strategies on what to do if you present an offer to buy the house “subject to” and, after discussing it, they do not feel comfortable with it.
Until my next post,
James
P.S. Upgrade to our premiere Real Estate Investor Bronze Membership today and get access to a wealth of additional resources, training and consulting.
Here are 4 amazingly simple ways to get others to find great real estate deals for you.
First, and this is an obvious one, hire a real estate agent or broker to scour their multiple listing service (MLS) and only bring you the deals that meet your very specific criteria. The overwhelming majority of real estate agents and brokers are paid only when you buy or sell a property using their service. They can look through the inventory they have access to and share with you the ones that meet you very specific needs. Then, when you find one that works for you, you buy it with that real estate agent or broker. You get a great deal and they earn a commission.
Second, find Real Estate Bird Dogs to go out and scout out potential deals for you. They may scour the MLS, real estate websites, classified ads, newspapers, real estate magazines, drive neighborhoods looking for vacant or for sale buy owner houses and work their personal networks to find potential deals. Then, they refer those potential deals to you, you work the lead and buy the house. Many Real Estate Bird Dogs are paid a per lead fee and/or a finder’s fee on any deals that you close on. It is more common for a Real Estate Bird Dog to be paid a small amount for each potential lead they bring you.
A step up from Real Estate Bird Dogs is the Real Estate Wholesaler. Unlike Real Estate Bird Dogs, Real Estate Wholesalers will go one step farther and negotiate the deal for you and put it under contract. Then, they usually mark the price up from what they are buying it for–careful to keep it a true deal for their buyer–and sell it to other investors or, in some cases, retail buyers. Real Estate Wholesalers tend to work a lot with other investors and sell their rights to buy a property instead of buying and selling the property. They tend to make their money as an assignment fee that you pay for the right to purchase the property using their contact.
Finally, you can find a partner that has a great deal. Partnering with the right person can allow you to leverage your strengths and the strengths of your partner. Partnerships are not to be taken lightly, so do your homework BEFORE you take on a partner. But partners can be a great source of deals that where your potential partner has a great deal, but doesn’t have all the resources to do it themselves alone.
Until my next post,
James
P.S. Have you heard about our premiere real estate investor training the Real Estate Investor Bronze Membership?
