I am looking for ways to acquire more properties without using my own money (because I don't have much!). I had an idea of getting information on possible homes/multifamilies in pre-foreclosure status. I can find the owner of the properties and try to track down their residential address. I would then send them a marketing piece explaining how I would be interested in taking the property off their hands for a creative financing situation (maybe a subject-to financing agreement and refinance later somehow). Is this a good idea? Does anyone else do this? What are some things I am naïve about with this strategy?
Since you're in Ohio and wholesalers have a hard time making money without a license, take a look at getting a license
If you're frugal on your marketing budget, you can go after expired listings and FSBOs,
I like expired listings because they generally don't have a lot of equity and their agent didn't take good care of them
If you going to market to FSBOs give them some marketing ideas to sell her house to make a friend, you may be able to either get the listing or buy it subject to or help them with a lease option
If you really broke trying to be a realtor's assistant and understand the business
But get in the game
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Sarah, Preforeclosures could be a good source of leads.
Personally I wouldn't start the conversation with creative financing. I think that is likely to make many sellers move on. Just let them know that you are looking for investment properties in the area and wondering if they would be interested in selling.
Once you are in contact and hopefully they get to know and trust you a bit, then you can talk about creative financing.
I personally like to make three offers...
1 - cash with a major discount
2 - seller financed with a big down payment and a reasonable discount.
3 - seller financing or taking over the note with nothing down, with a small discount (possibly none at all if it will cash-flow).
If they want option 1 - the discount is large enough that securing private money will not be a problem.
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