Pompano Beach, FL · Member since 2017 · 15 posts · 4 votes
Hey everyone,
My names is Alex and I'm a beginning investor from the South Florida area. I've sent out over 700 letters this month to absentee owners and I'm starting to receive calls left and right but I'm kind of stuck from here. I feel like I need a process that takes me from call to close to help me be a little more organized.
If someone can come up with a list of steps that takes me from receive a call or email from a lead to closing on a property for a wholesale deal please post.
i.e
step 1: speak w homeowner
step 2: see if they're motivated (what questions could I ask to see if they're motivated)
One thing to remember is that you can often make good money on "un-motivated" leads by referring them to a good Realtor. I often make over $1000/hr by doing this.
@Alexander Cadavid what did your direct mail to them say? Did you ask them to call you to buy their distressed house? If so, I would talk to them about the house and find out their motivation. Are you planning to buy the house, or find a buyer for the house? Do you have buyers lined up? I imagine you should discuss their house, what they would like to do with it and then decide if it is a fit for your business model. If it does get out there and look at it and get a deal going.
Since you are in the wholesale forum I assume that is what you are trying to do. You have to have a deal to wholesale a deal so now that you have leads you have to find out the basics about the property they are calling a bout . Since you have a list, you targeted location, property type, etc. What makes it a deal that you can sell? Your talk, visit to the property is all to determine if what they will take is a deal for you and if you will be able to sell it. I believe there are some scripts here on BP to help you get to that next step. Good luck
Sounds like you started your direct mail campaign without having a system in place to process the leads. Knowing how to listen for distress and motivation is crucial, and having a good follow-up system is as well. When you speak with the homeowner, the first thing you need to do is to collect information to figure out whether they are motivated or not. If you would like a script on what questions to ask, I can send to you.
It's good that you took action and started a campaign, just make sure you can process the leads you're spending valuable marketing dollars to get!
@Ray Lai I have a script and I know to check for motivation. I just need help with the system part. What steps to take after I find a motivated seller. What do I research?
One thing to remember is that you can often make good money on "un-motivated" leads by referring them to a good Realtor. I often make over $1000/hr by doing this.
One thing to remember is that you can often make good money on "un-motivated" leads by referring them to a good Realtor. I often make over $1000/hr by doing this.
What do you charge the realtor for the lead? Or do you only get paid if they close on the property?
@Justin Westmoreland it varies, but I generally make 1/4 of the other Realtors commission at closing.
Wow I like the sound of that. I would refer leads to realtors all day if I was getting 25% of their commission. I'm giving my realtor leads right now for exchange of sending me comps and getting me info I might need on a property. Why would a realtor be willing to give up 25% of their commission? If I was a realtor I would say I'll give you a couple hundred dollars if I sell the property.
Are you a licensed realtor? If not you can't get the commission split that Brian is talking about. The realtor can only split their commission with another realtor. With that said, I was starting to look into this myself. It does not appear to difficult to get your license, you can take the course online then take the exam. I believe you need to get a broker to sponsor you as well to get you license. I haven't finished my research yet but I also haven't started my mailing yet either. If you have active leads coming in I would jump on it if I were you.
@Justin Westmoreland and @Michael Badin - It's common for a Realtor to split their commission with another Realtor in this way on a closed deal. That's the key though. It's a closed deal rather than just a "lead". I also spend a few minutes on the phone with the lead, coaching them to list with my Realtor partner and I spend time with my Realtor partner, coaching them on how to convert these types of leads. I have found a great Realtor to work with and we get probably 50-75% of these leads converted and closed. It works out to be great money for me on a per-hour basis, because I am already talking to the sellers on the phone anyway (they have called me to see if I will buy their house). I just spend 10-15 minutes doing some pre-qualification and coaching of them.
Are you a licensed realtor? If not you can't get the commission split that Brian is talking about. The realtor can only split their commission with another realtor. With that said, I was starting to look into this myself. It does not appear to difficult to get your license, you can take the course online then take the exam. I believe you need to get a broker to sponsor you as well to get you license. I haven't finished my research yet but I also haven't started my mailing yet either. If you have active leads coming in I would jump on it if I were you.
I am not currently a realtor but it doesn’t sound like a bad idea especially if you can make the money spent on getting a license back with just one deal.
@Justin Westmoreland and @Michael Badin - It's common for a Realtor to split their commission with another Realtor in this way on a closed deal. That's the key though. It's a closed deal rather than just a "lead". I also spend a few minutes on the phone with the lead, coaching them to list with my Realtor partner and I spend time with my Realtor partner, coaching them on how to convert these types of leads. I have found a great Realtor to work with and we get probably 50-75% of these leads converted and closed. It works out to be great money for me on a per-hour basis, because I am already talking to the sellers on the phone anyway (they have called me to see if I will buy their house). I just spend 10-15 minutes doing some pre-qualification and coaching of them.
That’s a great idea, thanks a lot! I will look into this.
@Justin Westmoreland - It only takes a few minutes with them on the phone, but I have learned that there are some very specific things to say, and some things not to say in order to help them along the way to listing their home with my Realtor friend. In the same regard, there's some certain things that the listing Realtor needs to say.
@Justin Westmoreland and @Michael Badin - It's common for a Realtor to split their commission with another Realtor in this way on a closed deal. That's the key though. It's a closed deal rather than just a "lead". I also spend a few minutes on the phone with the lead, coaching them to list with my Realtor partner and I spend time with my Realtor partner, coaching them on how to convert these types of leads. I have found a great Realtor to work with and we get probably 50-75% of these leads converted and closed. It works out to be great money for me on a per-hour basis, because I am already talking to the sellers on the phone anyway (they have called me to see if I will buy their house). I just spend 10-15 minutes doing some pre-qualification and coaching of them.
Couple questions if your don't mind.
1. What is your process of "coaching" them (property owners) into listing with your Realtor/ partner?
2. What is your process of "coaching" your Realtor into converting this type of lead into a listing/ sale.
3. Also what type of leads do you go after? Pre-Foreclosure? Tax delinquent? Something else?
Are you a licensed realtor? If not you can't get the commission split that Brian is talking about. The realtor can only split their commission with another realtor. With that said, I was starting to look into this myself. It does not appear to difficult to get your license, you can take the course online then take the exam. I believe you need to get a broker to sponsor you as well to get you license. I haven't finished my research yet but I also haven't started my mailing yet either. If you have active leads coming in I would jump on it if I were you.
I am not currently a realtor but it doesn’t sound like a bad idea especially if you can make the money spent on getting a license back with just one deal.
@Michael Badin - Way too much to type. It's taken me years to develop it and fine tune it. But now that I have it, it only takes 10-15 minutes on the phone to work it. I was just talking with my Realtor-listing-partner just 5 minutes ago, and he said that he thinks we convert/close about 3/4ths of the leads that we work together. On the types of leads - they are whatever/whoever calls in from my "I Buy Houses" marketing.
@Ray Lai I have a script and I know to check for motivation. I just need help with the system part. What steps to take after I find a motivated seller. What do I research?
If you have a motivated seller, then the steps would be
1) Get an accurate ARV on the property
2) Get an accurate rehab estimate
3) Take the ARV - flippers margin - rehab estimate - your wholesale fee = the price you can pay for the house. You put that into the contract.
4) Once it's under contract - shop it to your buyers
One thing to remember is that you can often make good money on "un-motivated" leads by referring them to a good Realtor. I often make over $1000/hr by doing this.
I tried to tag you from my phone but couldn't. I'll try again. Why would you refer to another realtor if you are licensed yourself? I plan on offering both services myself.
@Shawn Clark - did you see the part about making over $1000/ hr on referrals? Also, I have another sales gig that I work, and I like to hike and fish a lot, so I really don't have much time for the paper-work and taking pictures and putting up signs and all that. For the referrals, the leads are coming in from my "I Buy Houses" marketing. So, I'm already doing that marketing anyway. If it's not something for me to buy, I do a little sales script with them while I have them on the phone to build them up and get them ready to list with my other Realtor friend, then I send him a text or email with their name and number. He does the rest. We're all happy. Win/win/win. I spend maybe 15 minutes on it (30 minutes max) and make 1/4 of the side.
@Shawn Clark - did you see the part about making over $1000/ hr on referrals? Also, I have another sales gig that I work, and I like to hike and fish a lot, so I really don't have much time for the paper-work and taking pictures and putting up signs and all that. For the referrals, the leads are coming in from my "I Buy Houses" marketing. So, I'm already doing that marketing anyway. If it's not something for me to buy, I do a little sales script with them while I have them on the phone to build them up and get them ready to list with my other Realtor friend, then I send him a text or email with their name and number. He does the rest. We're all happy. Win/win/win. I spend maybe 15 minutes on it (30 minutes max) and make 1/4 of the side.
Gotcha. I just spoke to someone local who said the same thing. He's licensed but refers out listings. I guess you guys are just more efficient that way. I'm still struggling to find enough RE business so I would take listings all day long. But I get it. Thanks for the answer.