Probate investing is one of the best, most lucrative niches to invest in.
What other niche has folks that want to sell their property almost 100% of the time? Yet when I talk to folks that don’t invest in this niche, they have a whole lot of reasons why probate investing isn’t right for them. Most of them simply have to do with their mindset, not the actual niche itself.
There are dozens of excuses we tell ourselves at any given time about why we can’t do something.
- I don’t have the experience
- I don’t have the knowledge
- I don’t have the money
- I don’t have the time
- I just need to read one more book
These are all reasons that could slow us down or even sideline our investing careers all together if we let them. We get overwhelmed by the big picture or that great big goal sitting on the finish line. But in almost every case we just need to take that “one next step”. That is no different with probate investing.
1. I Don’t Know How to Talk to Those People
This is one of the most common objections that I hear.
It is as though there is a special language you need to speak. In reality there is one; it is the language of compassion. When dealing with this particular group of motivated sellers, you just need to be aware that they are often still grieving during the time they have the enormous job of settling the estate. You need to handle them with a little more care, and it is usually a little quieter negotiation.
Settling the estate will often involve not only selling the property, but cleaning out a lifetime’s worth of personal belongings. This is a job that the personal representatives often find overwhelming.
What do you do with your loved one’s “treasures” that were such an important part of their life, but you have absolutely no use for?
At the end of the day these folks have a problem and you are in the problem solving business; they have an unwanted house they need to sell.
2. I Don’t Know the Language of Probate Investing
There are some terms that are specifically associated with probate investing that you will need to be familiar with.
Here are a few common terms you will come across when working in this niche:
- Testate: A person dies and they have a will.
- Intestate: Someone dies and there is no will.
- Personal Property: This is anything that a person owns that can be moved such as cars, jewelry, stocks and bonds, money and antiques.
- Real property: Real estate and land.
- Probate: The legal process of administering a will which is overseen by the Probate Court. Matters concerning wills and estates are handled by the probate court. This would include money, property and any other assets in the estate.
- Beneficiary: The recipient of a “gift” of property which may be an individual or an organization.
- Guardian: When there is a minor involved, the court will appoint a person to protect any minor children personally and also the financial affairs of these minors.
- Fiduciary: The person or organization that has the legal responsibility of managing a person’s property such as the personal representative (Executor or Administrator) or a trustee.
- Petition: A written formal request that is filed with the court, for a specific order or action such as a petition for probate.
- Letters: This is the court document that establishes the right and the authority for a person to act as a personal representative (executor or administrator) or conservator in an estate. In the case of an estate, the executor’s letters are called “letters of testamentary” and an administrator’s letters are called ‘letters of administration”.
All you need is just a basic understanding of some of the more commonly used terms in the probate process when working in this niche.
3. I Don’t Know Where to Begin
The first place to begin no matter what niche you’re working in is to determine how you get the leads.
Probate investing is a little different, because there are approximately 3300 counties in the US and each and every one of them has a different procedure. Here’s the thing; you don’t have to worry about all of those other counties. You only have to worry the counties you intend to work in.
Plan to do a little detective work to gather this information. When I was first starting out I just picked up the phone and called my local probate court. They were able to tell me exactly how the procedure worked in my county.
The niche of probate investing is a little more crowded than it was a few years ago, but it is still a whole lot less crowded that most other niches.
One thing to understand is that very few real estate investors are willing to see the process through over time. So if you just hang in there and do the work, you will find that “the crowd” gets smaller month after month.
Probate investing is a very lucrative niche for those investors that are willing to do the work. I love probate investing, and some of my best deals come from this niche.
What about you? Do you work in the niche of probates?
Be sure to leave your comments below!