Before you make offers and do deals, you have to know how to find sellers and contact them. This is the second article in the Wholesale series. You will learn how to find sellers in ways that are not as common as the newspaper. This way you have a better chance of getting the deals before someone else.
Direct Mail: This is a great way to get the word out to people that you are willing to buy houses. First you have to know what to say, and then you have to decide the best way to do it. One option is to create your own direct mail postcard. USPS gives some suggestions on where to do this here.
Usually one of those sites will let you create a postcard and they will print it and send it. You just have to design it, pay for it and tell them where to send it. Some may even let you do a trial postcard to send to yourself.
Wording is very important. The people who receive your direct mail pieces have to be able to understand what you are offering. Here is an idea on what you can write:
Do you own an unwanted house and need to sell quickly? Is your hose vacant? Need repairs? Are you in foreclosure? Behind on payments? Relocating? Divorce? Bad tenants? Owe liens?
We buy houses from people in situations just like yours!
We buy 5-10 houses per month and would like to buy yours. You’ll get a quick sale with no hassles. Call now to find out how we can solve your problem.
You can say what you want to say. Just make sure that you get your message to the sellers. They can then contact you and you can work something out.
MLS Expired Listings: A great way to find motivated sellers is to find expired listings on the Multiple Listing Service. The MLS is a comparable sales site available to real estate agents and other professionals. In some cases, you can access the MLS as an associate or affiliate member of your local board of realtors. Contact your local board and see if this is an option for you. Keep in mind, there will most likely be a fee.
If you are able to do this, you can find listings that have expired and did not sell. Contact these sellers. They may still want to sell and might sell for a lower asking price just to get out of their payments.
Attorneys: Attorneys have a lot of things cross their desks. For example, you could find tax liens, divorces, bankruptcies, and probate files that are still open. This is a great place to find a real estate deal.
To find attorneys, you could go to your title company and get referrals. You can also check the white pages or online. When attorneys give you information, follow through. Call the potential sellers!
City Planning Office: Each city has city plans available to the public. You can take advantage of this information by being a step ahead of other investors who don’t know what will be happening in the city.
For example, there was a busy freeway in Texas with two off-ramps in a certain area. There was some land in the middle of the off-ramps that was vacant.
A certain investor went to the city planning department and found out that there were plans to build another off-ramp in between the two that were already there – right by the vacant land.
This savvy investor found the owner of the property, who lived in Chicago, and bought a lease option for $3,000 per year. Meanwhile, he prepared a marketing presentation and presented it to major hotel chains. He utilized his option, bought the property, and later sold to two major hotel chains and a gas station. He made millions!!!
This is public information -- available to you! Use it! You could benefit immensely.
Drive Around: Some of the best deals that you will ever find are the houses listed for sale by owner near your own neighborhood. Take a Sunday drive with your family and look for new opportunities. Contact these sellers.
These are only a few of the ways to find people who are selling their property. They are also great ways to begin. If you're an investor or thinking of investing, do something this week! Make a direct mail piece and send it to yourself. If you are ambitious and want to do more, practice each of these ways to find sellers. You might even find a fantastic deal.
Good luck. Work hard. Be honest. Get out of your comfort zone. And most importantly, DO NOT use emotion when investing in real estate (ie fall in love with a house -- unless, of course, it is the dream house you will be living in forever). That's the best way to lose money. Logic, numbers, and... logic! Wooh!
And now for my deal of the day. I found this on Craigslist.
It's not super pretty, is it?
But OH MY GOODNESS does it have potential!
This baby is 3100 sq ft on 5 acres in a growing part of the city. There are subdivisions coming up all around it. It is a mile from a freeway entrance. No HOA (that's huge for me)! And all it needs is a little paint, some new light fixtures and hardware and it's totally modern (assuming the only repairs needing to be made are cosmetic -- I haven't done research that far). The price is low (again, I haven't researched it enough to know if it is wholesale).
I'm thinking that I'd like to go in and fix it up, subdivide the lots into five one-acre lots, sell four them for market value, and make a good amount of money while still living in my totally modern (and by "modern" I mean classic) fairly large house on an acre that I own completely free and clear (by selling a lot or two).
Hey, Tom... Can we buy this?