Find Motivated Sellers (Collection of Newsletters)|
by Scott Rister
Find Motivated Sellers
Findmotivatedsellers.com December ’01 Newsletter
What Is A Motivated Seller!
Welcome to the first publication of findmotivatedsellers.com newsletter! What better way to start off than to get right down to it asking yourself, “Why should I focus on motivated sellers?”. I would truly rather beat my head against the wall than talk to unmotivated and inflexible sellers. What is fun and financially rewarding in real estate is making great deals---not marginal ones. If you have a semi-ego then you may want to talk with your peers on the great subject-to financing deal you just closed on. However, you may be satisfied just knowing your income and wealth just added a significant asset with the three bedroom fixer-upper that you just can’t decide whether to wholesale it for quick cash or retail it for $15K plus. Either way, you can’t make it there talking to sellers who want all cash and retail value for their property. Your quickest way to immediate and sustained success in real estate is your ability to find motivated sellers----incorrect! It is the system that you implement that will bring those deals to you month after month and year after year. Sure, you need to have basic real estate knowledge: lease option, subject-to financing, and traditional bank financing. But if you know a thousand ways to creatively buy real estate with a inflexible seller then I ask, “what are your chances to truly make money?”. The answer is slim to none. Let me give you an idea of the sellers that you will talk to fitting the category of truly “motivated”:
The most important resource you have in real estate is time. There are those out there that will insistently tell you that to be successful in real estate you must have a large credit line, your real estate’s license to look up MLS deals, or to know everything about lease options. While all of those resources add merit to your ability to become successful it is still your management of time that unlocks your ability to discuss deals with the type of sellers listed above. You may have that corporate job and buy/sell real estate on the side or actually be a bona fide professional investor but in either case if your system to locate motivated sellers is not effective, consistent, and repetitive then soon you will soon find out that your “free” time turns out into chasing dead-end deals. It’s always hunting season for the real estate investor. Just be sure exactly what you are hunting. Answer is MOTIVATED SELLERS!
- I’m being transferred and just bought this house last year and just don’t know what to do since I can’t possibly afford two payments.
- I didn’t even know the house was going to tax sale before you sent me that letter and you are right that getting something now is definitely better than nothing.
- The house you wrote me about I just don’t have the money to fix it up and I would just like to sell and be done with it.
- I can’t manage that house living out of state and the tenants take advantage of me all the time. What do you propose I can do?
- The city told me that there are code violations on the property and they will bulldoze it if I don’t get up to standard. Can you buy properties like these? Answer in your mind is “yes” but VERY cheap.
Findmotivatedsellers.com January ’02 Newsletter Prescreen the seller!
When you are talking to sellers it definitely to your advantage knowing how to sniff out a great deal rather than a marginal deal as quickly as possible. The type of deals you should be focus on are the “no-brainer kick yourself if you let it get away” opportunities. No matter what anyone tells you there is no 100% guaranteed deal that you couldn’t possibly ever come out on the short end of. Even the most recognized real estate “gurus” out there will admit to deals they wished they hadn’t done. So your best insurance for success is finding motivated sellers that are going to offer the best terms and price. You should have your checklist of items to ask sellers when they call: address, # of bedrooms, fenced yard, CH/A, etc…. The conversation should not sound like a homicide investigation so you want to develop a rapport and rhythm with the seller. When you get right down to it though all of the specific information about the property is great but you want to find out their motivation. It is inevitable that some sellers will just be looking for a quick all-cash retail sale. You are not their answer. The name of the game is to find out their “situation”. You will be seeking the seller that has a perceived problem with their property and that maybe you are the solution they are need. After taking the necessary information you want to get right down to the core asking questions such as these:
If you are working with truly motivated sellers they will definitely not mind giving you a price range of what they are needing and even what the balance on their mortgage is if they have financing. When they can’t give insight to any of the above listed question examples or that their mortgage balance is their business, then go milk another cow. When someone says, “just look at it and make me an offer” you can but I wouldn’t suggest it. I will simply state that I sure don’t want to waste their time(actually mine) so if I had a ballpark range of what they are seeking that I can research more to see if I can meet their needs. Some sellers will be shocked that you wouldn’t want to spend an hour to go out to drive by, another hour doing research on what you could possibly offer, and then take the time to call them back only to hear them say that just isn’t an acceptable offer. Your time needs to be spent with motivated sellers on quality deals. When you talk to sellers you need to sift and sort though conversations to find their motivation so that you can find the ones that have great potential. Even the best of potential sounding deals may not work out but you can sure save yourself a lot of time knowing how to prescreen effectively to find truly MOTIVATED SELLERS!
- Why are you looking to sell?
- Do you have ballpark range of what you are asking for the property?
- Is there something in mind you are needing to make it worth your while to sell the property?
- If someone were to buy your property are you needing to close quickly?
Findmotivatedsellers.com February ’02 Newsletter Pushing The Envelope! If you had been looking for the biggest fan of direct mail, then you found him. I won’t hide the fact that this is my favorite medium of advertising getting motivated sellers to start calling me. There are many reasons I love direct mail so much and mostly because it is cost effective and prescreens my seller what I am all about. Cost Effective
My goal is .5% success rate. That’s it! For every 200 letters I send out I will field around 20-30 calls. Two to three of those will be potential deals and when I end up negotiating there will be one that is a bona fide “no-brainer gotta do” deal. Let’s add up the cost. Whether you are buying mailing lists or developing your own database there is time or money and sometimes both involved in order to secure the leads. Then you have postage and envelopes of course not to mention a voice mail system or way for seller to contact you which is all part of your overhead cost. I have gotten down to my “nitty gritty” evaluation of the numbers and generally I get back $5 for every $1 spent in direct mail. This includes my realized profit minus all of my overhead expenses. Do you know of many banks that will give you back $5 for every $1 you give them? I didn’t think so and that’s why direct mail to me is like money in the bank. In fact I really like spending money on direct mail because I know that that it all comes back to me in the end. Prescreens My Seller
If you need all-cash and full retail price then I am NOT your answer. I am an investor and expect to make a profit. If you operate your real estate business such as a non-profit charity organization then probably will soon know what Chapter 7 or Chapter 13 means. In your marketing program if the seller is receiving direct mail from you then either in the text of the letter or in another medium referencing anything like a “free recorded message” they need to be made aware that you are in the business to make a profit. When the seller reaches you then they are aware somewhat that you can be the answer to their situation or problem. However, they should also be expecting to be flexible on price or terms. If not then the conversation will probably be short if you are asking the right type of questions to find their motivation. Remember that time is the most valuable asset you have. So, a truly effective direct mail campaign should be cost effective and results oriented while at the same time prescreening callers. Follow these principles and you too will find MOTIVATED SELLERS!
Your success in real estate today, tomorrow, and next week lies in one simple ability: Find All The Motivated Sellers You Can Handle! It just doesn't matter if you are a seasoned investor or just starting out because making money buying and selling single family homes lies with finding GREAT DEALS - forget about good or marginal ones.