When investing in real estate, you want to focus your efforts on motivated sellers. This is true especially when you are just starting out. Dealing with motivated sellers makes the process go even faster, which means cash in your pocket sooner rather than later.
Motivated sellers are people who MUST sell their homes. So, what motivates a seller to sell his home? Financial distress, for one. Maybe he is behind on payments. Maybe he is facing foreclosure. Maybe even bankruptcy. Maybe he is facing a huge medical bill. Or a divorce settlement is looming on the horizon.
Sometimes positive reasons can force the need for a quick sale. A job relocation–not wanting to deal with a vacant house, let alone renting it out and having the value plunge. Getting married and having two houses.
Now, you may think you are taking advantage of these homeowners. Actually–you are doing them a favor. Think of what happens if the homeowner does not make the sale. He could be foreclosed upon, or worse, forced into bankruptcy. Or an empty house could be destroyed by vandals. Renters could wreak havoc on the value of the house.
It’s easy to see, then, that these sellers need you. You are, in fact, a savior of sorts.
How to Find the Truly Motivated Sellers
Okay, now how do you find these motivated sellers? Some tips:
Build a website announcing that you buy houses. Not a techie? Then have someone from www.elance.com build one for you.
Run classified ads in your local newspaper. Place your classifieds in dailies, weeklies, even free newspapers. Think: advertorials (looks like editorial copy, but is really an ad)
Set up bandit signs, those little signs on stakes and phone poles, announcing that you buy houses for cash, fast. Warning: Don’t get carried away creating these until you find out they are legal in your area.
Put signs on your car. You are now a rolling billboard. You’d be surprised how many people will approach you when you are parked somewhere.
A bit more expensive, but take out a Yellow Pages ad. Hint: Use the advertorial approach to stand out from competitors.
Online–go to classified ad sites, especially free ones, like www.Craigslist.org
Once you get going and can afford it, the direct mail route can be quite profitable. Mail to people within a zip code (shotgun marketing) or get a list of particular people, such as those in foreclosure (targeted marketing).
The bottom line: You can’t sit around waiting for deals to come to you. You must go out and find them and/or do things to get people to call you. But 90% of all sellers are not motivated, so be patient and willing to weed through a lot of unmotivated sellers before you get that one that is dying to sell his home for cheap.
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