Here is 10 low cost, highly effective ways to find highly motivated sellers!
Text blast your contact list: I almost always start with my immediate connections. Most people have roughly 200 contacts in their cell phones. This is a simple no cost way to tell people you are looking for great real estate deals. Create a simple text stating “I’m looking for a great deal on a 3 bedroom house located in zip code 12345 contact me if you know anyone selling and I’ll pay a finders fee if I buy it” Press send and have your friends bring you potential leads!
Bandit signs: Bandit signs are a great low cost way to find motivated sellers. You can buy blank signs off eBay for about $1.00 per sign. Write “I buy houses” with your phone number and place them at freeway exits of C and D class neighborhoods. You will get the best results in these areas! Take it one step further and place the signs in the front yards of abandoned houses. I do this all over Cleveland and the results are great! Not only does this get motivated sellers to call you but it also gets potential buyers contacting you asking if you own the abandoned house because they want to buy it! I explain to them that I’m trying to get the owners attention so I can purchase the property but I quickly follow up by saying “what type of property are you looking to buy?” This is a great way to build your buyers list to sell your properties to!
Craigslist ads: Craigslist is free so use it! Place an ad stating
FAST CASH FOR YOUR HOUSE
I buy houses any situation any condition
Do you need to unload a problem property?
Too many repairs
Behind on taxes?
Double mortgage payments?
Call Me! I actually buy houses and would love to make an offer on your property today 123-345-5678
Copy and paste this ad to craigslist and tweak to fit your style
Driving for dogs: The classic strategies always work! Driving for dogs is when you drive around neighborhoods and look for distressed properties. This comes in the form of overgrown lawns, trash in the yard, chipped paint, broken windows… When you came across this abandoned mess it typically means the owner is done and no longer cares about the property. Search the address on your county auditors site and try to find the owners current address. If you are unsuccessful searching on county record you can hire investigators on sites like fiverr.com to hunt down the owner for you. When you land the current address send them a letter letting them know you would like to make them an offer on the property. If they really abandoned this place then you may be able to literally take it off their hands! You won’t know till you ask so get out there and start hunting! Also while driving look for abnormally small for sale sign on the house. I’ve gotta be honest on this one I first witnessed this strategy on an episode of flip this house (most likely staged) where they came across a distressed property with a tiny for sale sign advertising the property. They pointed out that this was a sign of a motivated seller. At the time I didn’t think much of it but while driving for dogs in Willowick OH I came across a very distressed property with a tiny faded for sale sign in the front yard. When I called the number I found out the seller had the city all over him and he had no money to correct the violations. After some conversation the seller made it very clear that he would entertain almost any offer! I planned on a very low risk seller financing strategy to purchase this property. The seller agreed and we were ready to move forward. When I approached the city about correcting the repairs they requested 1.5X the point of sale expenses be held in escrow (roughly $40,000) for the deal to transfer. Unfortunately this killed the deal but the fact remains that a tiny for sale sign can be a highly motivated seller! Keep your eyes open for these while you are driving around scouting deals.
Newspaper ads: This currently is my favorite strategy. Newspaper ads were the rage back in the day but people have stopped using them and now utilize the internet. BIG MISTAKE! You know who reads the paper? People over the age of 50 still love the paper. This same group of people also are financially stable and do not like to deal with drama! I’ve learned that although they do not have money stresses they really do not like dealing with problem properties.
Because of this they are willing to let problem investments go for a song just to eliminate unneeded stress in their lives! Also newspapers ads are highly affordable now so it’s well worth giving them a trial run!
Cold calling investors: This is my second favorite strategy! Cold calling works great because no one is doing this! Jump on craigslist and start calling investors with ads that state “I Buy Houses” and ask them what inventory they have. Most of them just left a 1 day seminar and really have no clue on how to sell their newly found deals. They will be so happy you called an requested their list that you can cherry pick their deals giving them a small finders fee in return. I also call real estate agents on craigslist requesting if they have any deals that they have not placed on the MLS yet. If you sneak in before it hits the MLS you can beat your competition then you can sell it to your competition for a quick payday! Cold calling isn’t fun but it is effective. Your next call could make you a $2500.00 wholesale fee! I believe that is a good enough reason to pick up the phone and connect with investors!
Wholesalers with expiring contracts: Wholesalers can be motivated sellers as well! When a wholesalers contract expires they do not get paid. The closer to the expiration date the more motivated they get. Wholesalers have brought me decent deals that they have marked up $8,000+ dollars I know they would be great deals if they were only marked up $1500.00. I’ll tell the wholesaler to try to sell for their asking price but if the contract is about to expire I’ll pay them X. My best deals have been made by me making a crazy offer then leaving the door open for them to accept it at a later date.
Eviction court: Everyone hates real estate investing when they have to evict problem tenants! This is an amazing place to find motivated sellers. People are burned out because they lose money from a tenant not paying their bills then investors have to pay their attorney to evict the non paying tenant. This “Bleeding” makes people emotional and they want the pain to stop. Selling the property fast is the solution to end their madness. Attend eviction court and talk with a burned out investor after court. You may be surprised at what they will let a property go for after being in that situation.
Expired listings: This is an awesome place to find motivated sellers! Agents have homeowners sign contracts enabling them the right to list their home for 3 to 6 months. If that listing expires during that time frame the property owners motivation will go through the roof! Contact a real estate agent and see if they can provide you with a list of expired property listings. Send the seller a letter and see how motivated they really are. These may not always be great wholesale deals but they can almost always turn into amazing seller financing or lease option deals! Bring a buyer to the seller with the agreement that the negotiated deposit amount is yours and the seller can collect the monthly payments with a balloon payment down the road. This scenario is extremely easy to structure and everyone wins!
Hard money lenders: Although Hard money lenders typically have ample money backing them they are still a form of motivated seller. HML’s motivation can come in a couple different forms. The main way is they are only making money while there borrowers are making payments but if you borrow money at 18% plus a handful of points there is a fair chance those notes get defaulted on. HML’s rely on this cash flow to lend out more money. When the note goes bad they take back the asset and invest more money to get it marketable, fire sell it and cut their losses or they can structure favorable financing terms just to turn the cash flow back on again! Hard money lenders are also motivated to help their clients sell their properties. If you can bring in the buyers for HMLs not only will you earn great finders fees but you can earn their respect (access to their money) for assisting the team.
Remember this is a business! If you want the financial rewards of a business owner you need to work these strategies daily to become successful. Track your marketing daily and continue to push harder till you gain the results you are after. Great things come to those that “bust their ass” so start grinding and flip those motivated leads into juicy profits!