Probate Investing and Your Mindset
As most everyone knows, probate investing is one of my favorite strategies. If this is a strategy that you decide to pursue, there will likely be some challenges during this process. It is important in probate investing that you have the correct mindset right from the beginning.
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It doesn’t matter whether your strategy is probates, REOs, absentee owners, foreclosures or one of the other types of investing strategies. You are still looking for the same thing. A motivated seller! The only difference is that in dealing with the folks that have the task of settling the estate, you will need exceptional people skills. Of all of the problems you try to solve for any seller, this situation is by far the one where there will be the most emotion.
The vast majority of real estate investors are familiar with this strategy. And for the most part, people understand that you are providing a valuable service. But there will be some folks — you know the ones — that will proclaim loudly that you are taking advantage of someone at one of the worst times in their life. In reality, this couldn’t be further from the truth.
The Seller’s Viewpoint
Try to put yourself in their shoes. Often times they have inherited a property that they don’t want. It may be because the property needs a lot of repairs, and they either don’t want to spend their money doing them or they just don’t have the needed cash. It could be that there is an outstanding mortgage and in order to secure the equity is in the house, they will need to keep up the monthly payments.
You can usually sum up what they want in these two thoughts. They just want the cash that is sitting in the house, but they don’t want the problem of selling the house to get the cash. They are looking for a fast, easy solution with a payday. If you can solve this problem for them, then you have just found yourself a motivated seller!
Contacting the Seller
I only use direct mail letters to contact these folks. I never use postcards, and I never call them on the telephone. The key to working with these folks is to be respectful of their current situation in all of your dealings with them. Many of these people are still grieving long after the death of their loved one. It’s not unusual for them to take a year or more to even get around to selling any property in the estate. When I have someone call me to say that it will be a while before they get around to dealing with the property, I tell them that I understand completely; I know that it is a big job they are facing. I take that opportunity to ask their permission to keep them on my list so that when they are ready to sell, I can help. I have never had anyone tell me no.
Keys to Success
When it comes to probate investing and the correct mindset, the key to success is pretty simple. Put yourself in their shoes. Acknowledge that you know they are in a difficult situation. Treat them with respect and allow them to take action when they are ready. You just need to position yourself as the person that will be there to help when they are finally ready to sell the property.