Distressed Assets 101: Exactly Who You S...

talking Hey Moguls, Brecht Polambo here with another great lesson about what I know best – distressed assets. In fact, I’ve already given you guys some great content on this very topic so make sure you check out the first part of this series in this terrific lesson and this awesome lesson here, and while you’re at it, have a listen to my great training call too. J

Let’s get moving with today’s lesson though…

Who should you be talking to in order to score the best deals on distressed assets?

Talking to the right banks and distressed asset holders is critical to success. This doesn’t just mean the right institutions either. Get this wrong – and if you ever get to make an offer – it is going to be far from the best possible deal, even if you can get one accepted.

From Distressed to Success

In one way or another I’ve helped many of the nation’s biggest institutions and asset managers dispose of distressed assets, while helping real estate entrepreneurs scoop up great bargains and either flip them for big paydays or convert them into high-yielding cash flowing vehicles.

In the first part of this series we talked about how essential it is to be talking to the right banks…

If you aren’t hunting down the right banks for REOs and non-performing loan notes, you are just wasting your time. We talked about the different types of deals available, why it’s so hard to deal with the wrong banks, and how to find banks with distressed assets for sale. We also discovered that the best banks and credit unions to deal with are often smaller local and regional institutions.

Now let’s look at exactly who you should be talking to at these banks…

Some banks have created entire new divisions to deal with the vast amount of distressed assets they need to dispose of. Others have dramatically expanded the very small loss mitigation departments they already had. Some are just trying to make do by having frontline employees multi-task.

If you’ve ever experienced trying to navigate these mazes, after hours of being on hold, you already know that this is not a profitable use of your time. For many real estate investors and agents this is the fast track to going bankrupt themselves.

Even when it may appear that you are getting some traction from those channels, it can be a revolving door that you can’t escape. At best it means months of stress and frustration, with no promise of a good deal in the end.

decision This is why the third party loan modification and foreclosure rescue industry flourished so rabidly. Consumers just couldn’t get help going direct.

Fortunately there is a better option for serious real estate investors seeking deals, and Realtors seeking distressed property listings.

You need to be talking to real decision makers.

At small institutions this may include bank managers as well as executives with access to the president’s office.

How Do You Find Decision Makers at Banks?

Here are 5 ways to find decision makers at banks and credit unions with distressed assets:

Knock on doors at local branches
Attend local networking industry events
Data.com (formerly Jigsaw)
LinkedIn
BankProspector (at DistressedPro)

Generic B2B lead lists from data providers like Salesforce – Data.com can reportedly increase sales opportunities by 29% and productivity by 37%. But they can still leave a lot of work to be done. And create a very fragmented process.

LinkedIn can be great for honing in on individual contacts, but can be laborious by itself.

BankProspector pulls all bank data together along with contact information so that real estate pros can laser target decision makers fast, while having all the relevant data in front of them.

How to Work Your Inside Connections

I’m obviously a huge data and online marketing geek. I can’t hide that. But successfully acquiring distressed assets requires understanding that you are dealing with other real people.

This makes it a lot about personal relationships and being able to connect with other people. Remember that the bank manager on the other end of the phone, table or email has their own personal strife and aspirations. The last thing they want is more stress or being pestered on the clock. And beyond the institution’s needs and restraints, they have their own. They are in a constant battle to keep their own jobs. And they need to look great to their higher ups.

How can you help with all that?

How can you alleviate their stress over the distressed assets strewn all over their desks? How can you make them look awesome to their bosses? How can you help dispose of those REOs and NPLs in a stress free way?

Don’t try to show off with too much industry lingo. This isn’t a spelling bee!

Build real relationships. And keep on investing in them for the long run.

Have you ever considered that stopping by at 3:30 pm on Friday afternoon with a 6 pack and promise of an offer to be delivered on Monday morning – if they’ll spend a couple minutes sharing some details and banter – might work?

How about having tickets for the whole family to an ice hockey or basketball game delivered to the office with a list of their distressed assets you’d love to bid on?

Don’t confuse this with bribery. It’s about making their day. Zapping their stress. And making their lives and jobs better. It’s about giving and creating win-win relationships, versus just taking.

The Takeaway

Buying distressed assets from banks doesn’t have to be as daunting as it can sometimes appear.

Get the right information, talk to the right banks, connect with the right decision makers, and maybe you can even have some fun while you are making some big bucks.