There are different methods of finding these properties that we can turn into win-win situations. The key is MARKETING.  There are a lot of highly motivated sellers out there, but they just don’t know who to call for help!  Simply getting the word out is key.  It is easier to let a motivated seller find you than for you to track them down.  But for them to find you, you first have to get the word out. 

So how do we do that?  Here are some ideas:

1)     Flyers: These are a fantastic (and inexpensive) way to spread the word.  There was a link to a flyer included in your welcome email.  Feel free to print it out as many times as you’d like.  Use neon paper (orange, yellow, or green) that draws attention from a distance.  Hand it out to neighbors, post it at public bulletin boards, drop it off at laundromats, bus stops, coffee shops, etc.

2)     Business Cards: These you can pass out to everyone you meet, leave them at restaurants, put them in your bills that you send off when you pay them, etc. You can print out your own or use a service like www.vistaprint.com.  The message on the cards should be similar to the message on the flyer.  Remember that all it takes is one card to make you $500.00.

3)     Bandit Signs: You’ve probably seen them driving down the road.  They are the ones that say something like “WE BUY HOUSES” or “STOP FORECLOSURE.”  These signs work very well. They cost around $1-$2 each depending on where you buy them and how many you buy.  There are a lot of companies that make these signs.  Here are a few online sources:

      www.banditsigns.com

      www.signwarehouse.com

      www.signssupercheap.com

      www.dirtcheapsigns.com

Many online sites require a minimum amount (50 or 100), so you can check with local sign shops if you want less. 

The most effective signs are 18” x 24” plastic corrugated and hand-written.  You want a simple message such as “I’LL BUY YOUR HOUSE TODAY!  CASH!!” or “SELL YOUR HOUSE FAST” and a phone number.  They should have a white or bright colored background and dark lettering.  Make sure the phone number is big enough that people can read it as they drive by.  The signs should be placed near intersections, where people have to slow down or stop.

You should also draw a map and keep track of all the locations of your signs.  Check with the city/county before putting them out.  In most areas, you can put them out Friday evening and take them down Sunday evening.

4)     Print Ads: These are ads that you see in the local newspaper.  Again, they say something like:

WE BUY HOUSES CASH

555-555-5555

or

STOP FORECLOSURE

555-555-5555

These ads work, but they can get a little pricey.

5)     Internet: Websites such as craigslist.org, foresalebyowner.com, and backpage.com have motivated sellers posting their houses all the time!  If you find a property that we may be interested in, find out as much information as you can then submit the lead to us.

6)     Direct Mail: This is mailing to a list of people who are behind on payments and are in the pre-foreclosure process. You can get a Notice of Default (NOD) list from the county courthouse or from a title company.  The problem with NODs is that every other investor is also mailing to them so you have to be really creative.  If the homeowner is receiving 100 letters from investors, yours will have to stand out enough for them to not only open it, but also read it and act on it.  If you plan to do direct mail we will provide you with a sample letter.

You can invest as much as you’d like into marketing – from little or nothing (internet, flyers, and business cards) to a significant investment (a major direct mail campaign).  Marketing is your only expense, but it is an investment with strong potential for great return.

            There are many, many ways to locate motivated sellers.  The key is to get creative!

How many ways are there to make money on a real estate deal?  12?  or more?
That is one of the most exciting things about real esate to me because any given deal can provide a way to make everyone happy if you just know which angle to play.

Two of the most common techniques are Wholesaling and Rehabbing.
When considering these approaches the biggest question is:  do I want to make quick money now or do I want to take it a little slower and longer and get a bigger paycheck?

Wholesaling will get you quick money with very little actual involvement in the deal.
When you wholesale a property you basically act as an intermediary.
You have a buyer that is willing to sell a particular property at a very discounted price.
There are many reasons they might be willing to do so.
Once you have an offer to them you go and find another person to buy the property at a higher price.
You have no financial involement.
You don’t have to worrry about finding financing.
And you can typically get a deal done within two weeks.
It sounds simple and it really is.
Not necessarily easy, but simple.

Rehabbing is what you see all the people doing on TV.
You are buying a property that is in need of work (can be very minor or VERY major) and fixing it up to sell.
Interestingly enough rehabbers are wholesalers biggest clients.
On a rehab you are actually purchasing a property (which means you have to find financing).
You are then going to fix it up (whether yourself or with contractors; we use a combination).
You put the house back on the market (or market to your retail buyers list) for an increased price.
It sounds simple, and it really is.
Not necessarily easy, but simple.

An average wholesale deal will make you $3000 – $10000.
An average rehab deal is tougher to peg but, $15000 – $50000 is a reasonable range.

So, as you can see, which technique you decide to use all depends on what your goals are.

COLLEGE STATION (Real Estate Center) – As negotiations continue over the proposed $700 billion bailout of the nation’s financial system, Dr. Mark Dotzour, chief economist for the Real Estate Center at Texas A&M University, offers his perspective:

“It’s a sad day in America when the federal government (the American taxpayer) has to bail out homeowners who purchased homes they couldn’t possibly afford. It’s sad because of the vast majority of Americans who live within their means and pay their mortgages on time are now being asked to pay for other people’s mistakes.

“It’s a sad day in America when we have to spend billions to bail out financial institutions that made loans to those people, then sold those loans to pension funds and endowment associations that had no idea of the risk they were taking when they bought the ‘complex and sophisticated’ bonds. ‘Complex and sophisticated’ is just a euphemism for ‘I have no earthly idea what I’m buying.’

“Now for the pragmatism. If we don’t bail out the banks, the American economy grinds to a halt. Many U.S. businesses are financed with short-term notes that mature in 90 to 180 days. This is called commercial paper. What happens when your 90-day note matures, and nobody will refinance it? Just ask Fannie and Freddie, who had $225 billion in short-term notes mature and nobody would refinance them. Hasta la vista. The commercial paper market is virtually frozen, and many businesses are in the same boat as Frannie was.

“The smartest people working in the global financial system say that this $700 billion is a good first step, that it might help to thaw the frozen credit markets but that the devil is in the details. Some say it might take another $500 billion later.

“The fact is that there is a market for these bad loans. It’s about 22 cents on the dollar. The problem is that nobody wants to sell for that price as long as the taxpayers will pay a higher price. So the federal government will buy these assets for a higher price, and it’s possible that they can sell them later and make a profit. It’s possible that the net cost to the taxpayer will be very little. The bottom line is that we are in uncharted waters, and this $700 billion plan is the best plan that seems to have some hope of temporarily solving the problem.

“The long-term problem is still on the table, and that is the simple fact that the U.S. government can’t keep spending more money than it has. Even governments can go bankrupt. The long-term solution for the U.S. government and every American household is to live within their means.

“Who is going to want to invest in mortgage bonds in the future if the federal government can freeze the interest rates below what was promised? Who is going to want to invest in mortgage bonds if the government can cram down the principal on the bonds you bought? Until the federal government can restore some confidence in the global investment community that if you buy a mortgage bond you have a reasonable certainty of getting your principal and the promised interest, the problems will linger.

“The bailout is inevitable and has to happen. Expect more to come. These are just bandages on a gaping wound. Hopefully lessons will be learned, and we will begin to address the illness and not just put on more bandages.”

I’ve been a motivated seller before. I was so down on my luck at one point in my life that I didn’t have enough money to pay my bills. The reality is that motivated sellers exist.   They always have and they always will. In fact, in any marketplace, at any time, there are always a set percentage of sellers who are highly motivated to sell their properties. Why? Because of the following fact: Most motivated sellers are created by personal reasons, not economic reasons.

Market crashes in an entire area are rare. In most cases, motivated sellers are created by some personal situation unique to that individual.   While this personal situation is unique to the seller, you need to understand that there are patterns that play out over and over. You will be able to concentrate your marketing efforts on these known pools of highly motivated sellers.

When a seller is moving and can’t sell his house, he is faced with potential double payments or with the prospects of managing his property as a long distance rental.   When a homeowner gets into a situation where they have to transfer because of his work or move because of other reasons, the scene is set for a possible motivated seller.

The owner will usually have a specific date on which he will be moving or leaving. The closer you are to that date, the more motivated the seller will be.  Finding motivated sellers is fun when you go after it with the right attitude. Ideally, you want to feel like sellers are chasing after you, not you chasing them.

Many times a home can be an emotional anchor that ties a person to a painful memory. When two people who are married or involved in a serious relationship decide to call it quits, it’s not at all uncommon for a nice home to come up for sale and quick. Divorce creates the need to sell a property for three reasons.  It costs too much for one person to live in the home by him or her self. Dividing the assets is the easiest way to get a clean break in the relationship. Emotions from the relationship are linked to the house, and the owners want a fresh start.  There are many sellers out there working to put the pieces of their lives back together after the painful aftermath of a breakup. These people need your help to get out from the pressing reality of having to deal with their property.

Debt and money troubles are a reality for many sellers. Given the choice between foreclosure and selling, many owners choose to sell. One group of homeowners who need your help are those who’ve managed to get behind in their payments.   They could just be a month or two behind, or they could be much farther behind and face immediate foreclosure. Using purchase option techniques you are able to help these struggling sellers and earn a profit too.

One of the best sources of motivated sellers are landlords who want out. There are three reasons they make great motivated sellers.   First, they are already used to leasing out their property. This is the first half of a purchase option deal.   Second, they are used to letting someone live in their property, controlling it, for just one months security deposit.   While this isn’t nothing down, it is almost nothing down. Third, since the property was a rental and not their primary residence, chances are they won’t need all their equity out of the property to immediately go buy another property.

Many people who inherit property don’t want to have any involvement with the property. They just want to sell it. If they can’t sell it themselves, then your creative offer just might be the best way out for them.  One of the untapped areas of investing is finding owners who have received a home through probate. Homes go into probate when a person dies and leaves their house to a relative.  Many people who inherit a property are willing to accept much less for the property than it is actually worth.   After all, it was given to them.   They didn’t have to work hard to buy the house. And just like someone who has won the lottery becomes better at spending overnight, the new owner of a home received through probate is often willing to take less in order to turn a house into cash.

Growing families can stretch the seams of small houses which sparks the need for a larger place to live. Of course, for most people this means selling their old house.

You now know why motivated sellers sell. You also know what signs to be looking for when you are talking with a seller.

There are two criteria you must examine in your search for a motivated seller: The seller’s motivation and the seller’s situation.  Think about the M in motivated seller representing the seller’s reasons for selling her motivation. And the S stands for the seller’s situation. You need to find a seller with both.  First you must dig to understand the seller’s motivation for selling the property. Does the sellers motivation fit into one of the seven categories you just learned? When is their deadline for selling?   What else have they tried and what alternatives do they have left? How open have they been about sharing their situation with you? All of these questions will help you determine if the seller has a compelling reason to sell.

Next you need to understand the seller’s situation. As an investor, you need to find a seller who is either flexible on the price of the property or on the terms of the sale.   If the seller needs full price and all cash at closing, it is almost impossible for you, as an investor, to make a profit on the home. Before a property becomes attractive for an all cash price to a savvy investor, the price needs to drop by 30-40 percent.   While many investors aggressively negotiate with sellers on the price in the hopes of beating them down by these percentages, the purchase option is designed to allow you to offer a higher price to the seller in exchange for flexible terms.

As a creative investor who wants to help people and make money, you are looking for a seller who has flexibility on the terms of the sale.  You want someone who does not need all of their cash out of the property up front.  Does the seller need her equity out of her home to go buy her next home?   Or does she already own a second home? What would the seller do if she could not sell? If she would rent it out for a few years and then go to sell, she can potentially be flexible on the terms of sale.

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Richard Reichmann is internationally known as a millionaire maker. He’s a leading consultant in real estate and internet marketing strategies that are profit proven. Subscribe to our FREE newsletter Value $147.00 www.InstantRealEstateWealth.com