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Investing Strategies

The REO Sneak Attack Trick

sneak attackFrom Jamel Gibbs, Foreclosure Adviser...

Many investors who were thriving a couple of years ago are struggling just to survive today, crashing headfirst into the harsh reality that things ain’t quite like they used to be.

I’m not saying the road to profitability isn’t there anymore – it absolutely is! But it’s paved a little differently than it was. There are big, gaping pot holes where smooth asphalt used to be. And in many cases, it’s become basically a toll road that the average small investor can’t afford to drive on.

People always ask me how I’m able to do so well in today’s market. And the truth is, I’m actually doing better than ever. I’m closing more deals, in more markets, with better profits than ever before.

In large part, this is because I’ve mastered the niche. When “the cheese has moved” for others, I’ve found little corners of the market others aren’t really even thinking of, and I’m quietly milking them for all their worth.

{Note to Mogul Elite Members: Listen to JP and Jamel discuss this lesson in the Power Pack tools for this lesson. Look in the sidebar.}

One Sneaky Little Deal-Getter I’ve Been Using

The REO (foreclosure) arena is ripe with opportunity today. But it’s also harder than ever for the regular guy to make a buck. At least through “regular” means. I’m not saying it’s impossible – far from it. Just harder than it used to be.

I’ve developed a method my friend JP likes to call, “the REO Sneak Attack”. It’s not super fancy or magical. It’s actually very, very, ridiculously simple and easy. So much so, that you’ll probably face palm yourself, wondering why you didn’t think of it yourself.

Do You Have a Mailbox?

If you have a mailbox, you’ve probably already seen yellow letters before. In case you aren’t, they are literally yellow letters that look kind of like they were handwritten on a yellow legal pad, then torn out and mailed to you.

These letters are increasingly popular among real estate investors today, and for good reason – they get an amazing response rate. There’s just something magical about them, and I use them to market to motivated sellers all day long.


What I’ve done (it’s so simple, it’s funny) is re-directed yellow letter strategies towards the mailboxes of unsuspecting REO brokers, a group of people who likely have never seen one, much less had one show up in the mail at their office.

got reosHere’s the beauty of the yellow letter strategy:

REO brokers aren’t used to seeing effective marketing messages, so they tend to be caught completely off-guard when one of my highly targeted, REO-specific yellow letters sneaks past their security forces (also known as their gatekeepers).

The whole point of me reaching out to them this way is to make a personal connection with the agent – one that’s not often available to me by way of a simple phone call.

Why? Because being personally connected to REO brokers…having the chance to build rapport and build an actual relationship with them…

…Well it just gets me more deals.

It gets me mindshare with the guy who holds the keys to the castle. It gets me first calls on pocket listings in my areas of choice. It gets me preferential treatment on my offers.

Yellow Letters Work – Almost Universally

One of the most common questions I field is, “C’mon, Jamel! Yellow letters? They’re not really going to work on savvy REO brokers, are they?”

I’ll give you the numbers so you can decide for yourself. I’m the first to admit, yellow letters are usually a little more effective when I mail distressed homeowners. With them, I average something in the neighborhood of 20%-30%.

But distressed homeowners aren’t holding the keys to the REO properties I need access to. Even still, I consistently pull a minimum 10% response rate when I’m mailing the tough to crack REO broker demographic.

In case you don’t know, that’s an incredible direct mail response rate!

Scheduling and Content

I’ve analyzed the way I tap into the “REO Sneak Attack”, and I’ve located the secret to succeeding with this strategy. It all comes down to timing and message. Because you’re a Mogul member, I’m willing to share this highly effective strategy with you right now.

I’ve developed two letters. The first one I send to brokers when I’ve identified one with whom I’d like to work. Which is basically any REO broker with active listings. If they bite immediately, I’m in. If not, I’ll follow up with a second letter, which I continue sending until the REO broker agrees to do business with me – or they chase me down the street with a claw hammer.

(Reality check: There’s really no need to take it to this extreme. If they ask me to go away, I will. But until they do, I’m on an unending wash-rinse-repeat cycle with letter #2. They’ll have to either do business with me or make a conscious decision that I need to leave them alone.)

What My Letters Say

I’m not the kind of guy who saves his best stuff for those willing to pay me a king’s ransom for the privilege of getting pawed over, recycled advice. I don’t play that game. So here’s the full text of the yellow letters I send REO brokers. Feel free to copy and use it yourself.

Yellow Letter #1 to REO Agents: (Handwritten)


My name is Jamel Gibbs and I invest in properties in the area.  I noticed that you list REO properties which is great because these are the properties I'm looking for.

I'm currently looking for descent areas to invest in and wanted to know if you would be interested in talking sometime to see if we can help each other out.

When you get a chance please feel free to call me at xxx-xxx-xxxx.  I would really appreciate it.  I'm available anytime.

Please call me!

Thanks in advance!


Yellow Letter #2 to REO Agents: (Handwritten)

If they don’t bite, I send them a follow-up letter exactly 30 days later, which I repeat until they tell me to quit or they hook me up with a property. Here’s the text of the second letter:


Just following up with you!

I just wanted to let you know that I'm still looking for an REO agent to work with in the area.  

I'm currently looking for descent areas to invest in and wanted to know if you would be interested in talking sometime to see if we can help each other out.

When you get a chance please feel free to call me at xxx-xxx-xxxx.  I would really appreciate it.  I'm available anytime.

Please call me!

Thanks in advance!


Extra Juice for Better Results

wedding invitationWhen you mail yellow letters to REO broker prospects, you can goose your results just a bit by adding an element of intrigue to the process.

One of my sneaky little ways of doing this – and it really gets amazing results – is if your prospective REO broker is to add a dash of female perfume. Hardly anything grabs attention and creates intrigue more than an alluring aroma on a piece of mail. Think about it!

Another Juicy Little Tip

Rather than mailing your letters in regular #10 envelopes (everyone does that), try sending them folded up in invitation size envelopes. Or the smaller kind you send thank you notes in. You can even seal them with a sticker.

I mean seriously, who doesn’t open those?!?

And One More

I know people are going to ask me who I use for my yellow letters. And the answer is – at least at the time I’m writing this – I use I use Zach at yellowletterscomplete.com.

Great company, great service, reasonable prices, and their letters look genuinely hand-written. I really can’t tell they’re printed and not hand-written.

They’ll even do mailing lists for you! (not for REO brokers, but for sellers). Reach out to them and please tell them I sent you!

Be a Mogul: Use the REO Sneak Attack Today

This yellow letter strategy can take you further than you can imagine, but only if your letter is well-written. Don’t overcomplicate this, or try to improve on what’s already proven to work really well. Rather than taking an untested, unproven letter and hope it will work for you, simply copy and paste my yellow letters and use them to your heart’s content.

Do It To It! Immediate Action Steps

Beginning today:

  • Identify at least three REO brokers you want to contact.
  • Send REO Sneak Attack Letter #1 to each of them.
  • After 30 days, Send Letter #2.
  • Repeat the process until the REO broker calls you or does business with you.
  • Watch your business soar to untold heights :-)

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