A motivated seller is an individual who just has to sell their home; most of the times the factor/s that motivates a homeowner to sell their property mainly include financial crisis (involving bankruptcy or failure to pay a mortgage) or divorce. Other factors motivating sellers include relocation, in which case the owner does not want to deal with the hassles of a vacant property, or getting married, wherein two separate houses would make no sense. Such homeowners are in need of a quick sale so that they don’t have to face foreclosure, or have their empty house vandalized among other reasons. As a real estate investor it is important for you to find motivated seller leads because of the following reasons:
You don’t have to waste your time on listings that have a dead end
You can get a good idea of what kind of offer the seller will accept and what they will reject
In case the seller’s motive is purely money-based, you can find the right time for price-reduction so that the listing does not go stale
The bottom line is that having a single motivated seller is far better that investing your time in 10,000 possible sellers. In this article, we have put together some of the most effective methods that you can use to find motivated sellers who are in dire need to sell their houses.
Methods To Find Motivated Sellers:
The search to find motivated seller leads begins with your capability to come up with a list of those highly motivated homeowners who are ready to sell their homes as soon as possible. This means that you need to single out a distinct demographic of property owners who are way more likely to selling their homes than any average homeowner. Here are some efficient methods that you can incorporate to find such motivated sellers:
PPL Websites For Motivated Seller Lead Generation Online
There are companies that have multiple websites running online for generating leads of motivated sellers in desperate need to sell their houses as soon as possible because of financial distress, medical problems, divorce, etc. Such websites post information about the property of such motivated sellers and distribute these leads to an exclusive lead buyer instead of sharing the leads among various investors. It is important to note that PPL websites provide exclusive leads to a single buyer rather than offering shared lead (with several investors receiving the same lead and competing to buy that property).
Opting for online lead generators is one of the most effective ways to look for motivated sellers. Most of the time online lead generators work to ensure that motivated sellers find you rather you spending your energy and time to look for motivated sellers. Consequently, you can use this saved energy and time to convert the leads into actual deals. US News Real Estate opines that almost 90 percent of those individuals who sold or bought houses in the year 2015 began with online search. This means that most of the market is essentially dependent on online information for real estate deals, and not opting for online lead generation would simply be foolishness on your part as a real estate investor.
Another efficient method of finding motivated seller leads is direct mailing, which offers you the chance to engage in direct communication with sellers requiring your services. Through direct mail you can:
Easily reach out to the target audience
Develop a strong mailing list
Provide your contact details to the target audience
Educate target audience about your latest deals and services
However, you need to be able to optimize the direct mailing list that you create so that you can make the most of your list. According to an online journal (insight), the following steps have been shown to work best for optimization:
Step 1- Identifying the audience
Step 2- Targeting the audience
Step 3- Selecting the direct mailing list type for communication
Step 4- Sending the direct mail
Make sure to mail individuals within a particular zip code (which refers to shotgun marketing), or create a list including a particular type of individuals, like the ones in foreclosure (which refers to targeted marketing). Also, opt for a hand-written letter (in yellow) for greater impact. The letter should be enclosed using live stamps.
Alternatively, you can try out split-testing your mailing options as well their results by opting for various codes, reference numbers or phone lines. But you need to remember that timing is what matters the most in direct mailing. You have to ensure that the mail you send reaches the receiver on the most appropriate days so that you can get maximum attention as well as response.
Since you are well-aware of the target audience, you need to strategize your direct mail in such a way that they will find what they are looking for in your mail. It is only obvious that motivated sellers intend on selling their houses as quickly as possible in a hassle-free manner. You have to convince through direct mail that you will be able to provide them what they what, and build a strong communication with such motivated sellers by providing them your contact information, site for selling and buying, as well as the reason why your services will work best for their real estate deals.
Networking Among Family And Friends
You can also count on networking to help you find strong leads on motivated sellers. Talk to your family members and friends and let them know about how you are looking for motivated sellers for your real estate investing business. When family members or friends get information on individuals looking to sell their property desperately, they can forward such leads to you.
Again, another good way to network is to visit the Real Estate Investment Associations or REIAs in your locality. Visiting a local REIA will give you the opportunity to communicate with other such real estate investors to exchange trade secrets and share any lead information that may prove mutually beneficial. Try to attend REIA meetings so that you can expand your network, and improve your communication with fellow investors that will help you get information on motivated sellers in and around your area.
You can also opt for networking through social media, especially Facebook, where you can come across motivated sellers through News Feeds. Social media can prove to be the most useful tool for finding distressed sellers.
Driving For Dollars
While this method is not as easy as direct mailing, you can efficiently use it for spotting motivated sellers. In this, you need to drive around different neighborhoods (target areas), and look for homes that are in desperate need of being sold. It is a bit tricky to identify such distressed houses; however, if you keep doing this for some time you will soon gain expertise in spotting the right homes with motivated sellers.
Generally, any distressed property is characterized by:
Piled up newspapers
Such houses can prove to be greatly beneficial for real estate investors, but the problem does not lie in locating a distressed house, instead, it is finalizing the deal that proves to be difficult. As soon as you have spotted the house, you need to get in touch with the seller lead. It is quite common for owners of such distressed properties to be fed up of investors communicating with them, which is why you need to be as careful as possible when communicating with such homeowners. Either send a direct mail, an email or just knock on the door!
Reassure the homeowner that you will help them with their problem, as this is the best way to make the seller want to cooperate with you. Once you are able to get the motivated seller to cooperate, you will be able to close the deal very quickly and easily.
Calls For Dollars
If you are on a tight budget, you can opt for this method to find motivated seller leads. The underlying idea of this strategy is to communicate with the seller through phone call so that you can convince them to choose you for selling their property. Calling up sellers and talking to them can work more effectively to motivate them. You also get the chance to negotiate with the seller and close a deal if you can engage in conversation with the seller. All you need to do is create a list of sellers, which you can find online, and then start calling them up to talk about selling their houses.
You can also find phone numbers of sellers in some foreclosure listings that is available at county buildings for free, and at any title company for an extremely nominal fee. Phone numbers can also be collected from neighborhoods with signs like “For Rent” or “For Sale By Owner”.
Scanning Public Records
You may not be aware but public records too hold a lot of data related to motivated sellers. In the County records, you can find information on new mortgages, notices of delinquency or NOD, transfer of real estate properties, payments of property tax and foreclosure proceedings among others. In case you don’t have the time to look for information, you can opt for software tools that will provide you access to such data in usable format along with contact information of the sellers (in bulk).
These days online advertising is available for free, which is why you should make the most of online ads. It is best if you can post advertisements, so that motivated sellers can get in touch with you with their requisitions regarding their deals. Also, make sure to either post a fresh advertisement or refresh your existing advertisement within a few days’ time frame.
There are some highly effective offline advertising methods that you can implement so that motivated sellers contact you for selling their houses. These include:
Flyers You can opt for using flyers to communicate with motivated sellers without actually spending a lot of money. The only cost will be that of having the flyers printed. Great places to hang the flyers include community boards including those in coffee shops and grocery stores. If the flyer contains your picture, then the chance of meeting with motivated sellers increases for you.
Classified Ads You can also consider placing classified advertisements in the local newspaper (not necessarily the major ones). Try to place the ads in weeklies, dailies, or even the free newspapers. Make sure you post an attractive and easy to understand classified ad.
How To Make The Most Of Motivated Seller Leads:
While it is important to find leads on motivated sellers, it is a whole different game to capitalize on such leads. You need to be quick in your response as well as follow up. If you waste even a second, you may end up losing the lead, as the competition is very strong in real estate investing.
However, that does not mean that it is tough to generate leads or calls, even in large number. You need to make sure that you give detailed attention to all viable details. You may also require assistance in some cases for screening your leads. No matter what your arrangements are, you have to ensure that your leads qualify as soon as possible. For this, you may resort to different strategies like testing the motivation of the seller, negotiating numbers and finding out if the person you are communicating with is the actual decision maker or not. If you are sure about the deal, you need place your offer as soon as possible and that too in writing.
Remember, not all leads will be willing to close a deal or sell their property to you immediately, even though they are highly motivated. There will be a few who will work on short sales, and there will be others who require a bit more persuasion to be motivated to sell. This means that just because you are not accepted initially, you should toss away a lead. Each lead can end up in a deal, you need to religiously follow up as well as keep a track on the seller and property. Find out if their foreclosure date is looming around, or if they have received a new set of violations, or if their property’s value is going down or up. There is no point in hesitating to retrace your way back to the seller with a new offer.
For a motivated seller, money is all that matters. They are always looking for easiest deals, most profitable margins, as well as quickest paydays. If you can put in the right tactic you will be able you capitalize on your leads. You have to continue pursing your leads so that you can leverage them to close the deal. Never give up!
It can be difficult to find motivated seller leads but using the methods mentioned above, you can surely locate a motivated seller in no time. Don’t ever forget that leads from motivated sellers are your business’ lifeline. Eventually, a lead will convert into a deal, and a deal will turn into a business. Opting for an online lead generation, direct mailing, driving for dollars, networking, online and offline advertisements and calls for cash will ensure that you find appropriately motivated sellers who will be willing to sell their house to you.