How to Find Motivated Sellers Now

How to Find Motivated Sellers Now

“I’ve purchased Carlton Sheets course and every creative offer I’ve made has been rejected” Al said. While Al wasn’t able to become one of the few
people I work with personally, I was still impressed with the incredible desire I saw in his eyes. “Sit down Al”. I instructed. I’ll give you an essential secret in the five minutes I have before I have to go catch my flight.

“You see I used to be right where you are.” I said. “I wanted to create financial freedom but I just didn’t know how. What I’m going to share with you right now is a big reason that I’m able to put together deals 8 out of ten times when I go to meet a property owner… these days.”

Al pulled out a notepad and wrote ‘8 out of 10” at the top. “The secret of being able to close deals is to get more and more careful over time who you are willing to make offers to.” I said. “In the beginning, when you are first getting started investing, you should really go out and make as many face to face offers as you can. You’ll be talking to sellers who aren’t highly motivated but that’s OK because you’ll be doing this just to get comfortable talking to sellers and also to practice your negotiating skills.”

“Don’t even try to get a deal for the first 10 or 20 offers.” I continued as Al looked over at me quizzically. “If you happen into a deal when you are
practicing then good for you, just don’t be over eager in the beginning. After meeting with 10 to 20 sellers in this fashion you’ll be ready to start qualifying sellers at the next level.”

“You’ll want to find out as quickly as possible whether or not you are dealing with a motivated seller who is open to a creative offer. Truly motivated sellers make up a small portion of the market.” I shared. “ Trying to make a creative offer to a seller who isn’t motivated is like trying to teach a pig to sing… It not only won’t work… it also annoys the pig.” Al laughed at this point thinking about the reaction he had gotten from some of the sellers he had made offers to.

“As an investor, you’ll want to make a profit on every home you invest in.” I explained. “There are two basic ways that you can do this. You need to get either a good price or good terms. A good price means buying at a low price so that you can resell today. Good terms means that you get to control the property without putting much money up front and you wait for the property to go up in value.”

“Buying low tends to leave the seller a bit upset, Al.” I continued. “ I’ve seen sellers cry when I told them how little I was willing to pay them.”

“I’ve found that it’s easier to find motivated owners who are open to terms. As long as they get their price, even if they have to wait a few years for it.
They’re happy.” “Is it important for you to feel like you are helping other people to be happy?” I asked Al. “Heck yea!” responded Al.

“The secret to doing this without getting frustrated is in the questions you’ll ask in the first few minutes on the phone.”

“The first question to ask is “Do you need all of your equity out of your home to go and buy another home?” I said. “You see Al, If the seller needs all of
his equity up front, he’ll need to find a retail buyer to sell the house to. This means that this house is not for you, just wish the seller luck and get on to your next call.”

“If they don’t need their equity out of the property, then continue with your phone call. Does this make sense Al?” “Sure does Peter.” Al responded as he furiously scribbled notes on his pad.”

“The next level of qualification means the seller is open enough to be willing to look at a creative offer. Do you know the best way to find this out, Al?” I
asked. “No, please tell me.” Al responded. “You ask them.” I said.

Al seemed suprised that it could be this simple. “When I’m serious about qualifying a seller, I’ll say, “I invest in a variety of ways and I’m not sure which of these methods might be able to help you. Sometimes I’ll lease a home for a year or two and then cash the seller out at the end of the lease…Will that work for you?””

“If the seller answers yes or maybe then he’s worth a visit. If the seller says no I wouldn’t ever do anything like that, then you gently and quickly get off the phone.”

“To fully qualify a seller you’ll take the conversation a bit farther. A common mistake that beginners make is to race right to these final questions before asking the initial questions I’ve just shared with you. The problem with this is that without the initial questions, you’ll sound too eager.” I said. “Go slowly but surely and you will be successful, Al.”

I continued. “Your final questions are going to involve laying out a possible deal right over the phone. Saying things like, “I don’t know if I could offer you this exact deal or not, obviously I’ll need to see the house. But if I were to offer you rent of… and a price in 2 years of… Is that something that would work for you? If not, what did you have in mind?”

“You see, Al, what you are really doing is roughing out the negotiating arena with upper limits for what you might possibly pay. You’ll hopefully be able to
negotiate down in person from the numbers mentioned on the phone.” I said.

“Now if the seller seems inflexible or just wants way too much then you should save time by moving on, quickly, to your next possible deal.” I said with a wink. “Which reminds me. I need to catch my flight. Use these ideas to get started and then call me for more help. I might be able to take on another student by the time you call.”

How to Cash In On Your Real Estate Contacts

How to Cash In On Your Real Estate ContactsMany investors make the costly mistake of considering real estate agents as competitors. They incorrectly see themselves out in the market competing for a limited number of deals-fighting it out with local agents and brokers to make money. This costs them time, and it costs them thousands of dollars from lost deals.The truth is that as an investor one of the most profitable relationships you can ever develop is with a real estate agent. Think about it for a moment. As an investor your market is motivated sellers who don’t need all cash at closing (and are willing to be flexible on the terms of sale) or who are willing to deeply discount the price of their properties for an immediate sale.

But the majority of sellers you talk with as you do your lead generation are NOT motivated sellers. As many as 90% of the sellers you talk with are not motivated enough to be flexible on price and terms like you need them to be. Most investors toss these sellers into the round file, and this mistake costs them dearly.

Instead, pass those sellers you cannot help onto your real estate agent ally. He will be able to turn these sellers into a steady stream of commissions as he lists, then sells their homes.

Remember: most agents spend tremendous amounts of time and money to find the very people you turn up in such great numbers-homeowners looking to sell for all cash and who have the time to wait for a top dollar offer.

If you can help your agent friend get just one more listing a month you are adding tens of thousands of dollars to his annual income!

So what’s your payoff? Actually, you don’t just get one payoff, you get five!

Payday Number One: Expired Listings

A listing is an exclusive agreement a seller signs with an agent giving them the right to sell the home for the seller. This agreement is typically for 3 to 6 months and many times an agent is unable to sell the house within that time period.

Have your agent ally search the MLS (Multiple Listing Service-a database of properties for sale that only real estate agents have access to) looking for properties that didn’t sell and whose listing has expired. These owners are far more likely to have grown motivated and are ripe for you the investor to call and put a deal together on their house.

In many cases the expired listings will not have a phone number for you to contact the owner. That’s good! If it were too easy then another investor would have beat you to the prize. Simply take the information and do your own research. You can use the street address and a reverse directory to look up the phone number. (One such directory is called the Cole’s Directory and is probably available for you to use for free at your local library.)

Once you find the phone number, give the owner a call and see if they are flexible enough for you to buy their property.

Payday Number Two: Listings Search

Have your agent friend do a search of the MLS for key words that indicate motivated sellers. The agent simply searches the comments field for words like: “lease-option,” “flexible terms,” “owc,” “moving,” “transferred,” “estate sale,” or “contract for deed.”

If a listing has these words in it chances are pretty good the seller is worth a phone call. Then you contact these owners and see if you can put a deal together.

Payday Number Three: Straight Referrals

Just like you are out there sorting through sellers, so too is your real estate friend. And when he finds an owner he can’t help but who shows signs of being motivated, your agent can refer the seller to you. Better yet, ask your agent friend to pass along the owners name and phone number and give the owner a call yourself. This is a great source of deals that no other investors will know about!

Best of all, when you get this third party referral you are getting a huge boost to your credibility. In essence the real estate agent is recommending you to the seller. This makes things much easier for you to put a deal together than if you were just coming in cold.

Payday Number Four: Fast and Free Access to Property Information

When you’re out there putting together deals, wouldn’t it be valuable to be able to call up your real estate contact and ask him for information like sales comparables, market rents, and rates of appreciation?

If you’re passing on several good leads a month to your real estate friend you will be amazed at how fast he will get back to you with this information he simply pulls up from the MLS. After all, if he isn’t fast, there are many agents out there who are dying for your leads who will be much faster…

The most important thing to remember when you are putting together this relationship to begin with is to always be willing to give value first. This means pass leads on to your agent friend for a short while BEFORE you ever call them up asking you for a favor. This will help you build trust into the relationship and cement your agent to working with you.

Over time this relationship will payoff handsomely for you. When you get the relationship going strongly you’ve just added a helper who is working with you to help you make more money.

One of my students used this idea of networking with real estate agents to find a six year lease option on a $200,000 property with nothing down! If he can do it, so can you.

Making Money With Out Of State Owners

Making Money With Out Of State Owners

You are about to learn about one of the best-kept secrets in creative investing. This hidden source of motivated sellers can be one of your biggest money-makers ever!

People who own property in your home town but who live out of the area are great leads for you to talk with for three reasons. First, they are having to deal with the property long distance as either a rental property or as a vacant property. This means more headaches, hassles, and bills for them to deal with.

Second, they already have another place to live in their new location. This means that they don’t absolutely have to have all their equity out of the property you are negotiating on. The real benefit to you is that they seller can be flexible on the terms of sale. You can structure a long-term lease option, owner carry financing, or a land-contract.

Third, most times you are the ONLY person talking with them about buying their property. And any time you are the only buyer around the price always drops and the terms always become more flexible. This means you will be able to structure a win-win money-making deal.

The best part about out of state owners is that they are easy and cheap to find and contact. You just need to find a property in your town where the tax bill is being sent to an address far away. This usually means that you’ve found yourself an out of town owner. The best part is that on the tax records, which are public records, you will usually find the owners phone number too! You can do your own research in your local county records (too time consuming in my opinion.) or you can just buy the names, addresses and phone numbers you want.

Simply call up a local information source provider (you can find one in your yellow pages.) An information source provider is a business that has gone to the effort of putting all the county property information onto a huge database that is easier for you to access. You can dial in to this pool of information and download it over your phone line and into your home computer. Or you can simply call the company up and ask them to create a list of out of state owners for you that you can buy from them. Typically this costs between 10-15cents a name. When you find out how much money you can make by buying properties at incredible prices and terms you will realize that this is the greatest bargain you’ll have ever made.

When you get your names you can send out a letter or postcard to entice interested owners to call you. If you choose this route feed these incoming calls into a “24 hour recorded message.” This message should be 60 seconds of the biggest benefits you can offer to an out of area seller. The sole purpose of this message is to motivate the seller to leave their name and phone number so you can call them back.

The best way to turn your list of out of town owners into cash for you is to pick up the telephone and call the owners direct! Your conversation will go something like this:

“Hi this is David. I’m an investor in (your home town) and I have your number here as someone who might be interested in selling a property in the area. Is there a reason for us to spend a few minutes talking about that or probably not? Oh, there is… can you tell me about your property…?”

The biggest objection you will get on the phone is, “Where did you get my phone number?” Just tell the truth: “I hired a researcher to find me the names and phone numbers of people who owned property here that met my qualifications. They gave me the list and your name and phone number were on it. Is there a reason for us to spend two minutes talking about me buying your property, or probably not?”

Of course you’ve noticed the use of the negative sell with the “probably not’s” used. I’ve found that this approach will give you the best results.

The final secret to putting together a deal with an out of town owner is to slow the whole thing down. Make sure you don’t ask to many detailed questions on the first phone call. Things like what the loan balance is and what the monthly payments are are better left to the second phone call. The first call is just to find someone who is motivated to sell. Once you find that person get off the phone with them fast. Tell them you’ll drive by the property if you have a chance and give them a call back in a day or two. Then on your second call you can get into the details. This allows them time to get to know you and feel comfortable working with you.

So just how effective is this strategy? One of my students used it and found a retiring landlord who sold my student THREE properties worth a total of $480,000… and all three of these deals were nothing down owner financed deals! So what are you waiting for?

How to Find and Close Your Next Deal In 72 Hours Or Less

How to Find and Close Your Next Deal In 72 Hours Or Less

Back in December of 1997, my partner and I followed through on a dramatic press challenge. We had challenged the press, “Send us to any city with a group of three beginning real estate investors, and in three days time each of these investors would either own or control a minimum of $250,000 worth of real estate using none of their own money.” The challenge was accepted and on December 8-10, 1997 we went down to San Diego, California to make good on our challenge.

During this 72 hour period Peter and I and these three beginning investors picked up over $1.5 million dollars worth of real estate with only $37 down. That’s right, we picked up ten separate properties ranging in value from $90,000 to $500,000 and the most we put down to control any of the properties was $10. (The best part is that these ten properties are now worth well over $2.5 million!)

Since that time I’ve been asked many times how we did it, and how someone else could do the same thing. Taking what we learned on the original San Diego Challenge, I want to share with you how I would find and close a deal in any city in 72 hours or less-and how you can too!

Step One: Getting your leads together-Fast!

My first step would be to visit the local library and collect all the local paper’s real estate for sale and for rent ads for the past 2-3 months. I would go through the for sale ads and create a phone number list of the for sale ads that satisfy two conditions. First, they must be for sale by owner ads (you don’t want to be talking through agents if you need to close a nothing down deal fast.) Second, they would need to be at least 1-3 months old. Next I would list the phone numbers of all the properties for rent that are between 2-3 weeks old that look like they are NOT controlled by a property management company.

Step Two: Sorting through the leads

Step two would be to find a phone and start making calls. The biggest benefit of listing the numbers on a separate sheet of paper rather than calling out of the classified ad section itself is that the newspaper will only slow you down. All the information about the house doesn’t matter until you find the right seller-a motivated seller. Then you spend time checking out the details of the house.

Since you have aged the classified ads you are calling time will screen out many of the NON-motivated sellers for you, leaving you with a more concentrated pool of motivated sellers to talk with.

How long would I spend on the phone calling property owners? Until I set up 4-6 quality appointments to meet with sellers. Your goal from your phone call is to find a seller with both a situation you can help solve and who has the motivation to sell. Once you find a seller like this set up a time to see the property and talk things over.

One of the biggest mistakes many investors make is to try to explain your offer over the phone. Don’t do it! Instead, if the seller presses you for an offer tell him, “Look Mr. Seller, I don’t know if we have a fit here or not. It might very well turn out not to be a fit. Before I know what I can offer you, or even if I can offer you anything, I need to know a lot more about the house and your situation. The next step is for you to invite me out to see the house and for us to sit down and talk things through.” Notice how you are being a reluctant buyer here. The other benefit you get from this approach is that you never have to try to explain your offer over the phone before you’ve met with the seller (which is always an uphill road to climb.)

Step Three: Meeting with the owners face to face

The final step to get a deal closed in 72 hours would be for me to go out and meet with these 4-6 sellers. I would build rapport, listen and draw out their real needs, and find a win-win solution to meet their needs and make a profit for me as the investor. From these 4-6 appointments you would close the deal.

There you have the specific game-plan to find and close your next deal in 72 hours or less. Still seem impossible? We’ll we repeated that San Diego Challenge two months after the first Challenge. And with three different beginning students we picked up three more houses, worth approximately $750,000, with nothing down. These steps work. The only question is will you.