It’s true of any business that the value of an opportunity is equal to the difficulty in finding it. If great deals were very common, pretty soon, they wouldn’t be great deals. Everyone would want in and the price would go up.
Real estate investing is no different. The best deals are not sitting out on the MLS waiting for you. Many of those properties are bid up to an unprofitable level as soon as they come out.
If you want the really good deals, you’ve got to be a detective. First you have to find the property, and then you have to find the owner.
You can’t buy a property if you don’t have a seller.
The Internet Replaces the Repo Man
Well… not quite. The Repo Man still needs to do the ‘Repoing.’ But the internet can give you some great ways to track down the owner of a house you want to buy.
Say you are doing the old Driving for Dollars –you drive past some houses with the tell-tale signs that nobody is living in them:
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Tall grass in the front yard
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Unshoveled snow in the driveway or no tire tracks
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Roof in bad shape
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Broken or boarded up windows
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Disconnected gas meters
You pull out your trusty house-detective notepad and jot down the addresses.
Obviously you won’t find the owner by waiting around at the house. You probably won’t have luck just mailing to that address either.
But you can start with the neighbors. Yeah it’s not the most technological solution, but it works well. The owner may have asked one of the neighbors to watch the house. Or maybe the neighbors are just nosy. Who knows?
If the neighbors don’t know, then it’s time to turn to the internet.
The More You Pay, The Better Data You Get… Sometimes
Just like any good businessman, you want what you need to run your business – at the lowest possible price.
Let’s start with free. There’s not much lower than that.
The tax records are the obvious place to start. If you don’t know your local tax records website, you can always look at Netronline. We wrote the site up in another awesome tech lesson, but it can get you to the tax records you need nationwide.
The trouble with tax records is that motivated sellers are not very diligent about keeping the government updated as to their whereabouts.
Fortunately, there are some private websites that will also let you look up the owner for free:
The features of these websites are pretty similar. Just put in a name that you found in the tax records, and they may be able to give you a current address for the owner. The data is not completely accurate and up to date, but a lot of it is. Besides, what did you expect for free?
Another nice feature of the sites is the address lookup. For instance, with White Pages, you can go to the Address Lookup page, and just type in the address. The site will not only return the owner, but also some neighbor names in case you want to go door knocking. This page can be useful if your tax records are not.
Next up on the pay scale is 555-1212. This is actually a website. Don’t just rush off and dial it on your phone like people used to do. The main focus of this site is to build custom lists for marketing purposes.
Building custom lists are pretty much what wholesalers do. But they also offer a skip tracing service.
When you find a vacant house, you can plug the address into 555-1212.com, and it will give you pretty accurate information on the owner.
The costs for the service at 555-1212 are in the form of monthly service charges:
If you don’t need to look up a whole lot of names, you may want to go for the 100 lookups for $8.95 option over 6 months.
Getting up into the higher-end searches is Microbilt. Microbilt offers all sorts of services such as credit screening and tenant background checks. To use its service, you have to spend a total of about $50-$60/month, depending on how long you agree to use the service (1 year, 2 years, etc.).
Once you do sign up, its “Enhanced People Search” is really cool. The searches for people cost only a quarter each. For 25 cents you can learn an awful lot about a person (see sample report):
Not only will they give you all the addresses associated with this person, but also all the phone numbers. You can then hit your prospect with both letters and phone calls to see if they will respond.
The most premium services for finding people are run through the credit bureaus and large database corporations. It makes sense they would have this service since they have a ton of data on all of us.
Accurint is run by Lexis Nexis. TLO is run by Trans Union. These are the most accurate databases you will find commercially available. They are the ones law enforcement uses to track down potential criminals.
Because they are very accurate, they are also pretty expensive. As of this writing, their monthly charges can be as high as $75. That’s a lot more than the other services you can use, even if the other services are not as accurate.
In fact, they don’t post their fees on their website. You have to call them for pricing.
Remember that I mentioned their services are free to law enforcement. Maybe it’s time to befriend a cop?
No matter how you find that motivated seller, the fact remains that you have to do the research. It is very rare that motivated sellers will seek you out. You have to make it very easy for them to talk to you.
Then let the deal-making begin!
Give Us a Shout
Do you have experience with any of these sites? Tell us about it in the comments section below.
Dig and be persistent. Follow the clues that will lead you to the good deals… the one nobody else knows about.
Be Accessible – In addition to you seeking out motivated sellers, make your presence known through websites, direct mail and other forms of marketing. Make it easy for motivated sellers to find you.
Don’t Rely on Tech – Real estate investing will always be a people business. Don’t think you can just rely on technology to find the sellers. Pound the pavement. Talk to people.