am i going to know when its a deal?

Question

i am sending direct mail to people and have just finished my first mailing to 600 people after four weeks. no luck on the first mailing, and i will send the second mailing this coming week.

most of the people that called back after that first mailing didnt want to sell much below market value. how long do i wait to call them back and follow up?

is this something where i really need to fish and poke at them a little bit to see if they will keep going lower? or am i going to KNOW when they have had enough .

Pat G. · Answer

@Brent Coombs Sorry about that, I will explain.

The house that is over leveraged, I have taken Subject To and made the previous owners make up the difference of in mortgage payment (if any) to what I could get from a renter.

Example:

Mortgage payment with taxes and insurance (PITI): $1,300

I know that I can get a tenant in there at $1200.

So there is a $100 difference that needs to be paid by the owner so that I can help them in buying there house.

So in the purchase contract I put that the owner needs to send me a check until the house is sold for $250 (my profit and the difference in what a renter can pay) and if I don't get that payment the mortgage (which is still in the owners name) doesn't get paid until I  get said check.

With the Subject To properties we worked hard to get people cashed out in 5-7 years, but some just stayed in there for more.

With a Subject To you are leaving the mortgage in the owners name, not getting a new loan, bringing cash, etc. so there is great leverage because the owners usually have good credit and don't want to screw it up. I have done hundreds of these types of transactions so I do apologize if I go to fast.

I have no problem with explaining.

Danny Woodson · Answer

im fixing up and reselling

Brent Coombs · Answer

@Pat Gage Hmmm. What do you mean by "House that is over leveraged - you can take payments for that can't you"?

My thought would be: House that is over leveraged - RUN AWAY FAST! (ie. same as you, and I, would do if they want retail price). Am I missing something?

But yes, @Danny Woodson, you do need to be clearer about your strategies, else why you are doing all this marketing!?

My thought is that when you are answering your callers, you don't need to apologize for saying that you are aiming to help Sellers that are motivated for a QUICK sale (and who therefore are amenable to accepting a significantly-lower-than-full-market price). Maybe your marketing material needs to be worded/targeted better? Cheers...

Danny Woodson · Answer

@Pat Gage

my main method is using all cash.  if sub2 and lease options will be able to help me close on more deals i would do them as well but i am not doing a good job explaining them to the seller on how it helps them/ me.

Pat G. · Answer

Danny:

What is your strategy for purchasing the home, i.e Subject To, Direct Buy, Wholesale or Master Lease, etc.? Or are you just looking for anything? If you are looking for anything you have to be ready for all things.

House that is over leveraged you do this...

House that needs work or is a junker you do this....

House that they want retail price  - RUN AWAY FAST!

House that is rental property you do this....

House that is dead relatives you do this....

When I was buying homes using the Subject To method, my first question to the caller was "Would you sell me the house for what you owe." That usually gets the ball moving, now if they say the house is over leveraged, well you can take payments for that can't you?

The key here is I had a method of purchase and then followed a process. That is what you have to do select a purchasing method and when you do that YOU WILL KNOW WHEN YOU HAVE A DEAL, because it will be right in front of you.

P.S. Direct mail is great and still works.

Good luck, let me know your purchasing method as you have a great marketing tactic.