All Forum Posts by: Cornelius Garland

@Jessop Adams I mailed about 2,000 property owners last year who got their properties bought at the tax auction. In my state of South Carolina, homeowners have a one-year redemption period from the tax sale to redeem their taxes, and we were trying to snag a few deals out of this campaign. In short, it didn't work out too well. We hand addressed every single envelope and printed all of the letters manually. It was a hassle. Then atop of that, the tax auction list from the county assessor didn't have mailing addresses on it so we had to manually skip trace all of the owners. We got a lot of calls in, but most people that called had no idea their properties were sold at the auction and wanted to keep them. Unfortunately, a lot of the older people thought their children or a relative was taking care of their taxes. It felt good  informing the owners, but we didn't recouperate our expenses we spent on marketing.

It's not all doom-and-gloom, though. There is a way to leverage this list. I suggest that you find the leads that are on your high equity list or on any of your other lists and personally call or fedex them directly. These individuals may be more motivated to sell.

The issue with this list is that you may get property owners with other liens against them or they may have no equity in the property. This is why I always suggest to cross-reference this list with an existing one to see if there are any matches. I hope this helps!

@Teresa DelaMater Hello! Definitely buy lined paper because it actually looks like a hand-written letter. I've encountered issues before with my printer when doing mass-mailings, and it was a pain. Last year, I manually printed and stamped 1000 property owners of a tax delinquent list and my paper kept getting jammed in the printer. The printer was also cutting off the top of the letters. It was a mess and took me like 8 hours to print all of those letters. Then after I did that, I needed to sort the letters carefully to ensure the correct letter matched the right envelope. Then I needed to stamp and mail the letters. The whole process took a week, and I was doing this 8+ hours per day with a group of guys helping me. How many letters are you sending? I highly suggest outsourcing this if this is above 200 because you'll need to send mail EVERY month to see a response rate. We found that we get a lot more deals under contract after about the 5th mailing.

I also like to keep the message very simple, but relevant to my list, on the first mailing. So I might say something like "I want to buy your house at 123 Main St for cash". Then on the second mailing, I'll make a bit longer. I'll say something like "My name is Cornelius and I drove by your property at 123 Main St, and think it will make a great home for my family. Please call me at 'My phone number' if you ever thought about selling." I like adding that caveat "if you ever thought about selling" because then it reduces the number of unmotivated people who call. I actually moved from direct mail completely. After spending $30k in mail last year and getting thousands of returned letters, I decided just to cold call now. It saves so much money and is much more efficient! 

@Christos Philippou Absolutely; I've been in that situation and was so lost the first time I encountered it. But I know exactly what you mean regarding the property being a gold mine. There are so many like that in my city, but I just don't have that much patience to navigate through those issues. The sellers can get real clingy, too. Not that it's a bad thing because I like helping them out. However, it is time-consuming and not monetarily beneficial to nurture one lead when I can go get dozens of deals by in the time it will take to close that one probate deal. Sometimes, I structure the deal and work with my attorney to draft the necessary paperwork then send the deal to a buyer that wants the property. I hope this works out for you because it sounds like a good spread!

Hello @Christos Philippou, I'm currently marketing to a neighborhood with a lot of distressed properties with title issues so I encounter this type of situation all of time. I live in South Carolina and the laws vary by state; however, I believe the overall process is the same across the US.  According to my state's laws, your seller is correct; they will need to open an estate and go through probate, which will take roughly 6-9 months. It can potentially take longer if any heirs want to dispute their interest in the property. I've heard of properties being held up for years because the heirs can't agree on a price to sell the property for.

I typically walk away from these deals because I can't immediately make a return on my marketing dollars. However, I occasionally get involved. One tactic that I use is placing an option on the property and fronting the attorney costs for the probate. Firstly, I get a title search done and have my attorney tell me if the current individual I'm speaking with is the next-of-kin of the deceased property owner or if someone else has priority. If he tells me that the individual I'm speaking with is the next-of-kin, I'll go ahead and place an option to purchase the home. This ensures that the next-of-kin can't sell with another investor while I'm clearing the title, and I'm also able to recoup my funds if the seller doesn't want to follow through with the sale of the property. It's risky because you're putting all of your "skin in the game" without your seller having any. I suggest to only do this with cooperative sellers because the attorney is going to frequently need to talk to them and any relatives throughout the process. It appears like your prospect doesn't have energy to go through with the process, which is not a good thing. If this is a lack of motivation, it will be very difficult to go through this process since they will be uncooperative. If you think their lack of energy is due to them not understanding the process, then I would go ahead with it. Their lack of energy may just be an issue with them not knowing where to start.

Lastly, you can always wait until the property goes to the annual tax auction for delinquent taxes. In my state, the properties go to the auction if they're behind in taxes for one year. The property owner then has a one-year redemption period from the auction date to redeem the taxes. Some states foreclose on the properties and give you clear title as soon as you purchase it at the auction. I'm unsure what Delaware's process is for dealing with delinquent properties, though.

I hope all of this helps. I can elaborate or clarify anything for you, if needed. These situations are tricky, but they can be profitable if you are willing to go through the process.

@Joey Hampton I always get my lists off of List Source. You're able to filter by equity on there. If your list provider is able to filter by equity then I would use them. Just ask them because you can spend a lot of money on lists and not be able to wholesale them. I made this mistake on a preforeclosure list I bought and an inherited list.

@Ceary Williams @Joey Hampton I thought I would interject to provide some guidance. Your lists should definitely have equity and you also need to mail more than 200 leads to get a response. I've dealt with a lot of list providers in the past that promised the leads were "good"; however, after mailing I discovered there was no motivation at all. I would really try to stick with an absentee high-equity list. I found that there are typically not enough leads when I'm using other lists to efficently scale my marketing. For instance, while probates or inherited leads may be a good list to target, I'll never make it the basis of my investment business. You're essentially counting on people to pass away to get a lead. I'm not saying is impossible; however, this is something you can add after you close a few deals. 

Also if you plan on wholesaling, then I highly suggest getting up to 500 leads at a minimum. I've landed deals with a list with fewer leads, but I was targeting a specific neighborhood and we did some door knocking and a lot cold calling to increase our response rate. I'm glad you both are taking action; I just wanted to provide some direction so you save time and money! I've been through exactly what you're going through and understand it can be overwhelming.

@Vincent Crane I've encountered these situations and work very closely with my closing attorney to receive compensation from agents. You can get in legal trouble if you don't have your paperwork correct or process specifically established. Firstly, my company is not paid directly from the proceeds of the sale. Instead, I have an agreement with the agent to receive a marketing consulting fee for "managing his campaigns". It isn't a monthly fee; I only receive the fee whenever he closes on the property I refer to him. Additionally, my company isn't listed anywhere on the HUD-1 statement. Another bit of advice is that an agent working for a big brokerage will likely not do this for you. I only deal with local or regional brokers because they're more flexible.

Another tactic that I've utilized is getting specific power of attorney to sell the home for the seller. With that document, I'm able to list the property and receive compensation at closing because technically I'm the seller of the property. In this scenario, I would agree on a purchase price with the seller and sign a purchase and sales agreement with them. Then I bring my mobile notary over and have the seller sign the specific power of attorney, which gives me the right to list the home. Then I record the specific POA at the courthouse and send all of the documents to my closing attorney. The last step is to find a realtor to list the home. You shouldn't receive any pushback from a realtor or broker once you have the notarized document and it's filed at the court house. You are essentially the seller. At closing, your assignment or referral fee will be listed on the HUD-1 statement along with the purchase price you agreed to with the seller. The seller doesn't have to show up to closing and you can deliver the funds to them via check or have your attorney wire them their money. I've closed multiple transactions doing this, and it works in my state of South Carolina.

A lot of people may ask "How in the world do you get someone to grant you POA"? It's simple; we build rapport and only bring the document up after about the 5th point of contact. This is an easy sell to someone who's out-of-state, older, or is very busy. Your seller just needs to be comfortable with you and have confidence that you can perform. I am very transparent with my sellers and keep them in the loop during every point in the process. You are dealing with their biggest asset so this is a huge responsibility!

I want to emphasize that you should do your own research and consult your attorney before doing this. I had paperwork specifically drafted for my company by my attorney to ensure all parties were protected during the transaction. There is always a way to get paid for the value you bring. The "conventional" route is not necessarily the best route all of the time. 

Very Respectfully,

Cornelius Garland

Hello @Pedro Recarey, @Paul Amegatcher gave you very sound advice. I want to emphasize the point he touched on regarding the bank-owned properties. If you're intending to wholesale them, don't even try to get them under contract. The bank only accepts cash for foreclosed properties and you'll need to bring cash to table within 24-48 hours of signing the purchase contract. If you default on the contract, you can be potentially barred from purchasing future foreclosures and it you can quickly tarnish your reputation.

The website you listed should have a mailing address attached to the parcels. If not, go to your county's tax assessor's site and locate the individual's property and find who the owner of record is. There will be a mailing address listed on the property record, and you can write a yellow letter to them inquiring about the property. If the mailing address is the same as the property address but the home is clearly abandoned, you will need to conduct a skip trace to find updated contact information for your prospect. I usually cold call all of our abandoned property leads because it's a lot more efficient than writing the letters and hoping the seller calls us. Please let me know if you need me to clarify anything I stated or if you have any followup questions.

@David Chwaszczewski Thanks for chiming in! I wanted to assist Ceary but wasn't familiar with your area.

Also, @Ceary Williams I've had that issue as well. There are a couple of areas I started out Google Driving for Dollars in where I knew for sure there were dilapidated properties. My area is probably unique because there are hundreds (maybe thousands) of homes that are boarded up, but have huge potential. Charleston is a very interesting market, and my area may be a rare case. Either way, I would say you were successful because you saved gas and your time even though you didn't locate a property. Instead of actually driving to those locations, you leveraged technology and let Google Maps do the work for you. I would try a different neighborhood to see if you have any luck. A great trick to see where investors are rehabbing is to go to List Source and see which zip codes near you have had the most cash sales. This would be a great starting point. I can help you with this if you need any assistance. Just let me know.

I checked the Bergen County website and it appears they only have a directory that lists contacts in the county. One thing that irks me is that there is no national standard between the counties regarding the accessibility of their data. One county may have all of their data online and the adjacent county may require you to call to get access to the information. I would call the county assessor's office to see if they have a way you can access the data online. There may be a small fee to do this; however, it will be worth it if you need to search property records. Seperately, I was able to find Bergen County's register of deeds online. You can use this site to verify ownership and any liens or mortgages in a property owner's name. You can access it here.

@Tameka Daniels If you openly solicit your services on the Bigger Pockets forums, your post will be removed and you can potentially get your account banned. There's an ad section on BP where you can solicit your services. Just trying to look out!