Imagine that someone hands you a list of property deal leads – it’s a unique list because no other real estate investor has it.
What would you do?
Obviously, you would start contacting the owners immediately, right? I mean, it would be the best way to ensure that you score the best property deals before someone else does.
Fortunately, when you drive for dollars, you are doing just this: creating a valuable list of leads that no one else has.
Hey Moguls, Steph Davis here…
If you didn’t catch Part I of my lesson on this topic, make sure to check that out. In Part I, I describe how I drive for dollars and give specific tips for handling your FSBO and recently rehabbed property leads.
Now, back to my example for today’s lesson – I was able to find 16 abandoned or vacant properties during my drive. And I want to address those properties first...
Playing Detective: Abandoned Property Leads
With vacant or abandoned properties, what I like to do is find out who the owner is, do some research on the property, and then contact the owner via direct mail or phone call.
In many cases, you’ll discover that abandoned properties are bank owned.
Let me give you some advice: Don’t waste your time by sending the bank a letter. Not to be a Debbie Downer, but I always end up nixing bank-owned properties... because dealing with the bank isn’t worth my time and effort.
Another example worth noting – I used my local property appraiser website to search the address of a vacant property I found and discovered that it was a USA Housing and Urban Development (HUD)-owned property. So this was another instance when I decided not to pursue that particular property.
If your county doesn’t have a handy-dandy property search option like mine does, you can always do a good old-fashioned Google search for the address. Using the same HUD-owned property I mentioned above, I did a Google search, found the Zillow listing and clicked on it to learn that the property is a foreclosure.
So, using either method, I discovered that the property was bank-owned, and decided it wasn’t the right fit for me.
Instead, my goal is always to find the vacant properties that are privately owned, to find contact info for the owner and to reach out to them.
In another example, I entered the address of a different abandoned property into my county’s property appraiser website and found the owner’s name (let’s say its “Sally Sue,” for illustrative purposes) and mailing address. The property also included a legal description; we’ll say that was “Oak Ridge, Blk C, Lot 17.”
Using this info, I went to the county clerk website (where you can find deeds, mortgages, liens, etc.) and entered “Sally Sue” into the search bar. The search results showed me all of the properties that Sally Sue has owned or currently owns. I combed through the results to find the legal description (Oak Ridge, Blk C, Lot 17) for the property I was interested in.
I was able to find a few search results for this particular property on the county clerk website, including information that the property was in pre-foreclosure. I could even see the mortgage amount that was taken out on it.
Pro Tip: This info may seem confusing at first. I’ll admit, it took me a while to feel comfortable navigating through the county clerk website and the property appraiser website, and to feel confident about “translating” the lingo and abbreviated terms...
But if your county has similar online resources available, and you take some time to familiarize yourself with them, they can be extremely valuable resources.
Once I complete my research on the property, I then send a letter to the owner, or – if I can find a phone number, I call – calling is the best option. This saves you money (no need to buy stamps, envelopes, etc .) and time.
So, with a little bit of online “detective” work and determination, you can easily locate and contact the owners of abandoned properties... which means you could be well on your way to securing your next property deal!
The Finally Tally: My Results
Overall, during my drive for dollars, I was able to find 28 potential leads. Here’s the breakdown:
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4 FSBOs
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8 recent rehabs
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16 vacant/abandoned properties
FSBOs: I didn’t have much luck with the FSBOs. So, 3 of the owners I contacted weren’t motivated and had asking prices that were much too high. I left a voicemail with the 4th owner and didn’t hear anything back. But, lest you lose faith in my methods, read on!
Recent rehabs: Of the 8 properties, I was able to successfully get in touch with 4 investors who were interested in acquiring more properties – so I added them to my cash buyers database.
Vacant/abandoned properties: Because 8 of these were real estate-owned (REOs), I didn’t pursue any of those leads. The owners of 2 other properties owed too much (they were overleveraged), so I did nothing with those as well. The remaining 6 properties seemed promising, so I sent out 5 letters to get in touch with the owners.
The final vacant property is hopefully turning into a deal for me, so I want to give you a little more info on that...
Basically, after doing some online research on the county clerk and property appraiser websites, I learned that this property is owned by an investor in California who bought the property with cash about 8 years ago. There are no liens on the property, and of course no mortgage, so they own it free and clear. But it does need a lot of work. So, when I saw this property, I saw dollar signs. After finding the owner’s phone number online, I gave him a call and we began negotiations.
Long story short... it may seem like my search didn’t result in much. But keep in mind that this was only 1 hour of driving for dollars, and I was able to find a potential deal in just 60 minutes. So imagine if you had this success rate every month or even every week.
Although your list will be small – it’s an immensely valuable list. Because you are the only one who has it! Not only can you find leads for motivated sellers, but you can also build your cash buyers list. Plus, you can get a great education on the area.
I get calls all the time from people who are on a shoestring budget, and they may not have the funds for costly marketing campaigns or even bandit signs. I recommend that they drive for dollars because it’s essentially free – you just need the money for gas.
If you get in the habit of driving for dollars every other weekend or so, you WILL find very valuable leads that will put money in your pocket. It just takes some commitment, a little time and some research to make the most of your drive.
Ready to Roll
What was the best deal you ever scored after a successful drive for dollars? Let me know!
Find your online resources. Do a quick search to find your county clerk website and see if your area also has a property appraiser website. Bookmark both of these in your internet browser, because you’ll be visiting them a lot!
Filter through the vacant properties. Use online research to determine which ones are the “duds” and which are worth your time and effort to pursue.
Keep your chin up. It takes time and practice to generate deals from your drive for dollars results. Don’t get discouraged if you don’t find a potential deal each time. As you get more familiar with your area and your online resources, you’ll become more skilled at finding the right properties for your business.