I'm building up my first direct-mail list from scratch. Why from scratch? I'm attempting to offer solutions to folks going through the probate process and the list cost is just isn't worth the expense the providers are charging. I can find the same information for a lot less money and feel confident the data will be at least as good as what they are providing.
My real question centers on scrubbing the list. Before a potential client is added to our CRM system, we check county records to see if they actually have property in the estate. If they don't (because it already sold or they never owned anything) we don't bother mailing to them. This has cut down my list by about 40% so far.
But there are some of these potential clients who have already listed their properties on the MLS.
I'd like to hear some opinions as to whether we should send them our direct mail or not.
If you believe we should send them DM, would you change the piece in some way? For example, mention you'd like to be a second option for them should the listing expire?
If you don't think we should send them DM, is there anything else we should be doing with these potential leads? Maybe reach out to the agent directly to get a feeler on the motivation factor?
Exit strategy on the properties is likely wholesale, fix and flip, or rental (in that order).
Thanks in advance for all of your help!
I think you could still send the mail just so that you're starting to build rapport with them. If their home doesn't sell they can either go to you or cancel the listing with the agent in order to get a quicker sale.
I'd stay clear of the agent unless they come to you and then explain what you do. Generally, if a piece of mail gets to someone with a currently listed property I explain how I generally can't do anything with the property as we would lose to much money from the Realtors commission.
I wouldn't bother explaining what you're exit strategy would be. The seller doesn't care in most cases. What they care about is how you can help them so focus on that.
I think there is lower hanging fruit
I'm not a lawyer so no legal advice but I think if you are targeting listed properties, the people tasked with selling the property have entered into a listing agreement - you cannot cut the agent out so I don't know if this is the best use of your time/energy/resources because, as someone mentioned, there is lower-hanging fruit. You are finding the house because an agent has put it in the MLS so the agent may be able to prove they are the procuring cause of the sale if all of a sudden their client wants to cancel and sell to you. I think a better idea may be to get access to expireds, cross-reference that with your probate lists, and go after those when they are expired and fair game.
Thanks to @Steven J. for the answer... I wasn't planning on giving the seller my exit strategy necessarily. I added it to the post to give the BP community an idea of my exit strategy as it might influence their response. I don't mind dealing with an agent, and I wouldn't try to go around them, but I would much rather deal directly with the executor.
@Christina R. ... sorry I wasn't more clear. I am not targeting listed properties. I am targeting probates that might happen to already be listed.
I was (poorly) trying to ask if I should send DM to a property if I know that it is currently listed with an agent?
And if I do send to them and we end up doing business, is the seller then obligated to pay commission since our first contact was during the listed period?
The seller is more than likely on the hook for paying the agent something. I believe that even if they cancel the agreement and a sale is made within x days they still have to pay the agent something for their time.
I'd still send to the probate listing if on the MLS. And when they call just say that I don't necessary work with homes currently listed with a Realtor because the money I hope to make in the deal ends up going to the Realtor. Its not possible for both to make a decent profit.
By sending to them, and resending, they could possibly sell to you later on down the road if their home never sells on the MLS and becomes an expired.
I send to all probate prospects, and don't waste time to check if they are listed. I find that real estate brokers seldom are experienced in the probate process, especially if the probate is not complete. They will often list the property at full retail, even when it needs lots of work, and there are multiple heirs who will not agree on the offer price.
@Steven J. You gave me some great advice there. I haven't found very much out there at all from an educational perspective on the probate system. Since I have been building my lists, I have become very familiar with the market and I feel for the families of the deceased. A lot of the listed homes are way over priced considering the condition of the property. Most of the homes have good bones but are sorrowfully outdated. They sit on the market forever.
That said, building the list does take a lot of time. It probably takes 10-15 minutes per lead to gather up all of these data. My plan is to hire that out once I get the process down to a science.
If others have advice, I'd love to hear it!
Not really sure what your criteria is or your strategic plan.
Look for catalysts that compound the problem(s). People problems require more skill and deft handling.
Make a decision whether you want listed or off-market properties. Listed probates rarely provide the kind of margins that satisfy rehabbers.
Look for problems that the parties to the estate either don't know how to resolve or don't want to deal with. You are now in the problem solving business.
Thanks, @Rick H. for the post. My criteria are probates that have property, pure and simple. I don't want to spend time or effort marketing to people who don't have a problem.
That is why I am considering filtering out the probate leads that already have their property listed with an agent. So I am looking for opinions as to whether I should send them a letter or not.
@Joseph Ball What other "low hanging fruit" are you referring to? I have been mailing to probates for a few months now, so you have my attention.
There are several. You can rent a list. You can go to the courthouse and research probates.
You can search Craigslist for FSBO. You can drive neighborhoods. You can put out bandit signs. You can network with wholesalers.
I regard MLS as the Retail venue. To do what you are planning, you need wholesale.
@Joseph Ball Agreed. I need wholesale...
I pull my leads from the public notices, get the contact information from various sources, and verify there is property in the estate. Originally, I was checking to see if the property was listed. If it was, I excluded those from my mailings.
I'm not going to do that any more. It doesn't matter if they are listed or not - they'll still get a letter from me.
I'll follow the advice of Sharon Vornholt and others to and will mail until I buy it, it is sold, or they ask me to remove them from my list.
Thanks everyone for the advice!
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