Finding Deals??

[Rudy Centeno]

I personally do direct mail and cold calling but haven't had much success lately.

I've heard of investors who get listings from realtors and submit offers. Is this a good route to take or is it a waste of time?

Can anyone share the strategies they are using which have produced results?

[J Scott]

I get ALL my deals right off the MLS. They are all REO properties (foreclosures)...

[Eric Foster]

Deals are everwhere now days... Short sales, foreclosures, sellers who need to sell. What are you targeting?

[Danny Johnson]

When I first started I was marketing directly to homeowners with 'We Buy Houses' type marketing (bandit signs, letters to owners of vacant houses, postcards to absentee owners [tax bill goes to different address], doorhangers, flyers, etc.).

During 2009 and 2010, I was buying mostly REO's.

I am back to marketing directly to homeowners and buy a few REO's here and there.

What I have found is that I get deeper discounts from homeowners (mostly due to less competition). On average, the houses need more work, but my profit margin is bigger. The REO's are nice but there has been a lot more competition and I just wasn't getting the deals I was before.

Hope this helps. Your mileage may vary.

[Rudy Centeno]

Thank you all for the replies. How much below market value are all of you purchasing the REO'S for?

Danny,
You indicated that you have used flyers. Do you suggest using flyers instead of actual door knocking? I haven't tried door knocking yet. Any input would be greatly appriciated.

[J Scott]

For REOs, we're generally purchasing at 70-75% of ARV after you add in the repair costs...

[Jimmy C.]

I used to work PRE-foreclosure leads here with direct mail and telemarketing. It was great back in the day when people had equity and the market had not declined yet.

Now those leads wont do me much good, unless I want to work short sales. The majority of people in my area dont have any equity when they go into foreclosure.

I havent been spending hardley anything in marketing while working REO's and they are plentiful enough here not to worry about competition.

That being said, I am looking to get back into direct marketing, but changing the list to probate leads instead.

[Danny Johnson]

Jimmy,

Probate can be an awesome source for really great deals. I bought 4 from a wholesaler in December 2009 that were all such great deals that I paid the wholesaler $8-10k each.

Very Important: Make sure you look at the age of the deceased (don't want to send letters to parents of deceased kids). This was a warning in a course I studied several years ago and I always thought it worth remembering.

[Danny Johnson]

Rudy,

I have used flyers and doorhangers to blanket certain neighborhoods. The results were horrible. After several thousand, I only had 2 calls and both were worthless. These were the right neighborhoods too.

I use doorhangers now only when driving for dollars and leaving them on the door of the vacant houses.

If you are knocking on doors, have a professional tri-fold brochure made up. Include information about yourself and your company and, if you have them, testimonials from customers. If you don't have testimonials, get referred by someone that people trust (your Pastor for example). The brochure will project more professionalism and give you more credibility than a flyer.

[Rudy Centeno]

Thank you all again for your replies. Great info.
How do you go about getting a list of probates?

[Dennis Marshall]

Originally posted by Rudy Centeno:
Thank you all again for your replies. Great info.
How do you go about getting a list of probates?

You can go down to your county court house to the probate department if they have one specifically and ask for the latest probate leads. They should just hand them over to you.

I've also heard of investors finding probate leads in the newpapers. In Tampa, there's no such thing or I haven't found it yet.

Yea just get the decedents name and address then the beneficiaries (mainly the #1 benf) name and address and send them a personal letter. Be mindful that they have lost a relative or a friend so you want to be courteous but just state that you understand that there may be a home left behind that you would be willing to pay cash for.

Let them know the troubles of tryinig to sell a home the traditional way then tell the the positives of selling it to you.

I personally don't go after widows because they may still live in the house and have some sentimental attachment to it. you want people who live across the country and don't even know the home exists. When you tell them they can get 10k or 20k for just signing some papers, some, not all, will be blowing up your phone to get to the money. :mrgreen:

So where are you wholesaling at?

[Rudy Centeno]

Dennis,
Thank you for the great advice. My farm area is in California: Whittier, Santa Fe Springs and Montebello.

I have been sending letters to absentee owners but haven't had much success.

Can anyone share any techniques for cold calling that is working for them?

[Steve Babiak]

Here is the cold calling compilation:
http://www.biggerpockets.com/forums/87/topics/61286-scripts-for-calling-on-sellers

[Will Barnard]

Almost all my deals are coming from REO's but many are negotiated prior to ever hitting the MLS. I can accomplish this only thru the relationships I have developed over the years.

[Jimmy C.]

Thanks for the tips Danny and Dennis. Now I have to actually put some money into direct mail again.

It sure would be better than hearing "highest and best" all the time. Wish I was like Will here and didnt have these problems.

Plus REO's are not as easy to wholesale really. Talking and negotiating with regular motivated sellers again would be refreshing!