I pushed probate Monday off this week until Wednesday because I wanted to finish up and post the videos for my Lead Tracking program demonstration. Last week was a pretty busy week, but I don’t really have anything to show for it. Kinda frustrating to have your phone ring and come up with nothing.
For those that think I don’t get down or have my doubts about investing in probate properties, I do. It’s only natural to ride the roller coaster when you are getting going for the first time. It’s tough though because everyone and their mother is talking about the success they are having with Short Sales or REOs which makes it tempting to jump ship and try something else. Not me though, rest assured that I’m staying the Probate course and won’t give up.
What I’ve gotten very good at is ignoring the little guy on my shoulder that wants to take the easy way out. I may not have any results for my efforts so far but I can see some great improvement in my support base and the great relationships I’m creating with successful investors who I’m confident will be there for me when I need help.
As I continue to send out mailers, I’m constently listening and learning how these successful people are doing things. The guy who is providing me my Probate leads is a regular at one of the meetup meetings I attend and is a gold mine of information, strategies and marketing tips that I can use to help get more probate leads.
In the last meeting he shared with me his “speech” he gives potential sellers about what he does and how he comes to the price he can pay. It’s very good and uses a lot of the techniques that I’m reading about in the book Influence. It’s about small yes’s at first. What Brian told me was that he won’t go see a house unless he can get the seller to agree that he (Brian) needs to make a profit.
In the next few days I’m going to work on developing a presentation like Brian’s. When I say presentation, I don’t mean a power point show with pitches,pie charts and such, I’m talking about answers to their questions and an overview on why I’m offering what I’m offering.
Getting the sellers talking and figuring out their motivation, plus some canned answers and offer break down can really form a killer combination. Here are a few points I’m going to make sure to mention when presenting my offer
- Closing costs and fees for a double closing
- Repair Costs. Ask the seller how much they think it would cost to repair the house to sellable condition. Use their number if it’s higher then yours
- Since the seller understands and agrees you need to make a profit you can include that percentage
- Holding costs
- Selling the property at a reduced price to sell quickly
I won’t go into detail about these items, but just put them out there as real costs.
Goals for This Week
My one goal for this week is to send out letters to my March/April List. I’m going to try a new letter a got and see how that one works compared to the other one I have from Ron Mead’s Course (affiliate Link). This new letter is shorter and concentrates more on letting the seller know that I’m buying houses in the area. In a later post I’ll break down what the new letter says.
Just making it up as I go! Have a good week
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Hey Scott, I like your new approach. You are not the only one not getting good deals from probates. I've been sending out letters since February (about 300/month to 3 counties) and have only had 2 deals from probate, but it might have to do with the fact that I don't send follow up letters as much as I need to. They know I'm an investor and If they want a higher price during negotiation, I tell them, I'll go out of business if I buy their house retail. That's why I don't waste time on houses that need no rehab, those with rehabs are much more flexible. I use yellow letters but I'm beginning to question the effectiveness of yellow letters to sellers. It does get my phone ringing alright, but most of the calls I get are from people who are just wondering how I got their information or tell me they are not selling. Please let us know how your new letter works for you.
Scott,
I think your presentation idea is a fantastic one. The very last wholesale deal I did I offered a guy a whole lot less than his “friend” the realtor told him she could list it for.
What did I do? I explained to him EVERYTHING. I started telling him that I needed to make a profit and he agreed and understood that. Then I went into the repairs, the closing costs when buying, the closing costs when selling, the holding costs, etc. and I actually even physically wrote down all of the numbers out on a piece of paper for him. It worked.
He really understood where I was coming from then and we signed a contract together. 🙂
So I think you're on the right path buddy. And starting next week, I'm gonna be in the same boat with you in regards to having a fulltime gig while trying to accomplish things in my multi-family business. But I know that not only can I make this happen, but you can as well!
I have been sending probate letters consistently for 2 years now and the money is definitely in the follow up. About 50% of the houses I buy come after about 12 months of letters. Many of the people just simply aren't ready to sell in the beginning. I send them at about 6 week intervals for about 15 months.
I got a call today from someone that I had spoken with previously about a house. That house didn't work for me, but his grandmother died a few weeks ago and he still had my card so he called again. I think this house will work for me. I really don't know if he would have remembered me if it weren't for the follow up letters and the time I spent initially talking with this man.
I also don't use yellow letter for probates. I use a very professional looking letter. I have used yellow letters for other types of campaigns.
Sharon Vornholt
It's good to hear the update on the probate leads, Scott. I definitely agree with Sharon – the key is in the follow up, even in other areas of REI. I think it's really good that you are sticking with this, many folks try to do something else if things aren't working in the beginning. It takes time. Though, with the time you put into this you are learning first hand how things work in the probate world. By becoming an expert in one area, you will get to know that area very well – more than most folks and be able to recognize opportunities when they come up. And, that is priceless.