Financial Freedom Group Blog

Bandit Signs (and where to put them)

In my post on Finding Great Tenants, Curtis asked were to put the signs.

If you are putting out hand written signs (the best for a property you are trying to get handled, we know because we tested it) for a property that you have available for rent/sale or if you are putting out preprinted signs (you can use hand written signs too, we tested it too and you get good results either way) to buy more properties you want to put them at the busiest intersections around your property.  I place them on wire stakes so when someone is stopped at a light or stop sign my sign is right there for them to see.  You can also put them up on telephone poles but the utility companies my quickly take them down.  Use 18 X 24 inch signs.

Also, make sure you check with your local authorities to make sure putting out signs are OK.  (My method of checking was to put them out and see if they called me.  The technique nearly got me $45,000 in fines in a new city.  Test it out with a few signs first then roll out a larger campaign.  An 800 number keeps you anonymous too.)  In one city the ordinance was that you could put them out Friday to Sunday.  I went out at 12 midnight on Thursday night/Friday morning and then picked them up late on Sunday.  This can be a good strategy to stay in good graces with the city.  Most city workers don't work on the weekend so if you have them up from 6PM Friday to Sunday night you are in good shape.

Signs are by far the best way to get your phone ringing if you are either buying or selling a property.  It is a lot of work but the payoff is worth it.  You will only have to do it for a little while before you can outsource it to someone because you are making good money from all of the houses you are buying.

30 Ways to Find Motivated Sellers

I promised Ram that I would post 30 ways to find motivated sellers.

There are two different techniques to find motivated sellers.  First you can look for a specific quality of a seller that would make him or her motivated.  Living out of state would be one example of a situation that someone could be in that would cause them to be motivated.  If I own a property and live quite a distance from the property and there is a problem with that property (meaning it could be vacant, or be vandalized, etc) I could be motivated to have someone take this property off of my hands. 

The other way to find motivated sellers it to blanket an area for sellers.  If I put up 25 signs in an area my phone is going to ring.  One of our students put up 47 signs and had over 40 calls in less than a week from motivated sellers.  These signs were not put out to target any one group of people they simply read "We Buy Houses" and a phone number. 

So Here we go with the list.

1. No Equity - If they need to sell they can list it with a real estate agent and it will cost them money or they can sell to an investor.
2. Landlords evicting tenants - Can be very motivated and they are used to receiving payment over time.
3. Landlords that have owned the property for 3+ years (that is how long on average someone owns an investment property)
4. Landlords that own a property free and clear (you can take all of the management headaches off of their hands and still give them cash flow)
5. Property that is in probate - The heirs want the money
6. Referrals from other investors - Not every investor does every type of deal.
7. Home Owners Associations that are having trouble with a resident.
8. Owners that have owned the property for 7 plus years (the more equity the easier it is to put together a deal)
9. Mechanic's Liens - When someone doesn't pay for work that was done on their house you can pay that person that did the work a small sum for what they are owed and then try to collect.  If they don't pay you can force them into foreclosure and you can either buy the house or get paid what you are owned.
10. Recently Financed Property - You will find owners that need to get out of a house that they just bought or refinanced - You can find this into at the county recorder's office
11. Quit Claim Deeds - When a someone is given a quit claim deed to a property it could be a case where they don't want it or can't afford it
12. Divorce.  Many owners qualify for a property with 2 incomes and when one of those incomes moves out it makes it difficult to afford the payment
13. Multiple Property Owners - I have purchased three properties from the same owners and I have been to a closing with another investor that purchased 26 properties from one seller that couldn't wait to get rid of his properties.
14. Massive Equity - This allows you the most flexibility in putting together a deal
15. Out of Area Owners
16. FedEx, Postal Service, other Delivery Persons.  These people know the areas and which houses people have moved out of, been foreclosed on, have a divorce going on, or the owner has died.
17. Meter Readers - same as above
18. Process Servers - These people give the notices to people being foreclosed, evicted, etc.
19. Accountants - They are often times the first to know when someone is in financial trouble
20. Appraisers
21. Insurance Agents - My agent calls me when one of his clients is in trouble because he wants to keep the business and if I buy the property he keeps the insurance.  He probably calls me once a month.
22. Mortgage Brokers - When people can't qualify for a refinance you can buy their property from them.
23. Real Estate Agents - This is the first place people go when they have a real estate problem.
24. Handymen - When an estimated repair is more than the seller can handle, you can do the deal.
25. Bankers/Lenders - Once payments are missed they are going to call on you to bail out the seller
26. Bankruptcy Referees - You can purchase a property from someone that is being drug down financially by their property.
27. Collection Agencies - They are aware of the people with money problems.
28. Financial Planners - See accountant
29. Mortuary Owners - Handle this one with integrity and class. 
30. Bankruptcy Attorneys
31. Family Attorneys
32. Divorce Attorneys
33. Criminal Attorneys - It is hard to make house payments from jail
34. Probate Attorneys
35. Mold Problems - Mold has a terrible stigma.  I will buy a moldy house at the right price any day.
36. Code Violations
37. Builders
38. New Subdivisions - These houses are easy to sell and many times people get into the house and life happens.  They get divorced, transfered for work, etc.
39. For Sale By Owner Properties - Many times they are selling the home themselves because they can't afford to sell with an agent.
40. For Rent BY Owner Properties - Can be motivated because of no renters or bad renters.
41. Expired MLS Listings - Tried the traditional way and it didn't work.
42. Canceled MLS Listings - See Expired MLS Listings
43. State MLS Listings - Properties that have been on the market for many months usually have motivated sellers attached to them.
44. New Listings - Great deals come on the market all of the time.  You have to be quick though.
45. Tax Sales - If you don't pay your property taxes the government can sell a tax lien certificate which means that someone can take your house and any of the equity that is with it if you don't pay off the tax lien.
46. Bandit Signs - Great blanket marketing source
47. Postcards
48. Brochures
49. Bus Bench Signs
50. Newspaper Stands
51. Business Cards
52. Signs on Your Car
53. Cash Register Receipts
54. Classified Ads
55. Newspaper Display Ads
56. Door Hangers
57. Fliers
58. Newspaper Inserts
59. Post it Notes on Houses/Cars
60. Website
61. Yellow Page Ad
62. Google Adwords
63. Yahoo! Search Marketing

It looks like Ram got his money's worth.  I know there are at least 40 more ways to find motivated sellers.

[Update: fkj pointed out that I missed property management companies.  This are an awesome source for two reasons.  First if the seller is looking to sell are probably going to be the first ones to know about it.  Also the property management company knows personal details about the owner's situation and they can put you in touch with the owner to help them out.  Second if you find a property management company that does a terrible job you can find out which properties they manage and contact the owners of those properties to see if they are ready to sell.  Also the value of multi units is based on income and if the management company does a poor job you can instantly add value through increasing the income.]

Which of these techniques to find motivated sellers can you apply today?