Hey Moguls, Preston Ely here…
Today, I want to tell you about one of the best secret weapons I’ve been using since I got started in real estate investing that has brought me bazzillions of dollars (yeah, it’s a made-up word, just go with it). You might be surprised to know that my secret weapon is probates.
Yep, it’s true. A lot of people don’t understand probates or they’re confused about whether it’s even a valid strategy. So, I want to use today’s lesson here to lay out – in no uncertain terms – the case for why probates are still the shiznet. (Yep, fake words are awesome.)
Pro-bate: noun
1. Law. The official proving of a will as authentic or valid in a probate court.
I first heard of probate investing from a friend of mine who accidentally told me one of his friends’ investing secrets.
“Dude, he goes through the obituaries and contacts heirs with offers to buy the house the deceased left behind. He’s making $20,000 a month!”
Okay, so it wasn’t an accident. He told me on purpose. I seriously doubt his friend would’ve approved, however.
At that point in real estate history, probate investing was kind of a hush-hush secret. While everyone else was fighting tooth and nail for foreclosures, we were cleaning house with probates. It was like taking candy from a baby.
It still is for all intents and purposes (whatever that means).
At the time, I had been trying to find my personal niche in real estate and this idea struck me as a pretty darn good one. I mean, without even taking any probate courses (there weren’t any to take back then), I could clearly see the benefits and potential:
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Less competition
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Less seller resistance
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Less hassle
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Better response rate
Even now, there’s less competition because (i) fewer people know about it and (ii) people are intimidated by it for a myriad of reasons. I’m still wondering why so few investors knew about this form of investing back then. At the time, I lived in Florida (still do) and it seemed to me that this would be the best state in the whole nation to be doing this (for obvious reasons).
I don’t ask myself questions that don’t matter. All I knew was I had never heard of it before, and I thought I had heard of everything. So a new niche for me was born.
Probates rock
There is less seller resistance with probates. Why is that? I do happen to know the answer to this one. The seller is less attached to the equity. He didn’t earn it. (As opposed to the guy in foreclosure who has spent the past 15 years paying into that house and working on it with blood sweat and tears.)
Most controllers of estates simply want the assets liquidated for cash – quickly. They know in advance that they will not be getting market value and are likely not expecting it. Thus, you are getting qualified leads almost all the time.
There are exceptions, of course. Every once in a while a personal representative of an estate (or “executor” as they are called in some states) will decide to fix the house up and list it with a Realtor. We’ll still make an offer on these, but they are not as hot of a lead as the guy who just sells it as-is for quick cash.
Another probate benefit: There is less hassle with probate property. Foreclosures, on the other hand, are a nightmare. Usually you’re dealing with a very emotional and sometimes hysterical seller who is at their lowest point in life. No fun.
Try tracking these people down. Good luck. Most people in foreclosure are in denial and subconsciously ignore everything negative in life (including you), so as to shield them from the pain of reality. On top of this, you have payments to catch people up on (which can cost you big bucks), impending auctions to stop, short sales to do, etc. Yuck! Just not for me. There is a much easier way…
I’m showing you that way now with probate investing.
You are also going to get a better response rate with probates. If you send out 500 mailers to people in foreclosure, you are probably going to get… absolutely no calls. The response rate on those is horrible.
I had one lady show me over 100 letters and postcards she had received from investors while in foreclosure. Unbelievable. If I send 500 letters to heirs of estates, I will probably get a phone call or two every day, all month long.
Here, again are the main reasons why… less competition and, more importantly, 90% of the people who receive my letter want to sell their house, like now!
Of all the people you could mail to, you will not see a statistic like this anywhere else. The brilliance of probate investing is just overwhelming – in a good way.
Granted, more and more people are finding out about this little gold mine, but compared to foreclosures, this is like blowing goldfish out of an overpopulated 10-gallon aquarium with dynamite.
Here’s what probate comes down to
The gist (what’s a “gist”?) of probate investing is this: People die. Sad but true. When they die, they leave behind all their stuff because apparently you can’t take it with you (what a sick joke that is).
Some of this “stuff” occasionally is real estate. People inherit this real estate and usually want to sell it quick for cash. People who want to sell quickly for cash already know in advance that they will not be getting retail, so right away you are dealing with qualified leads.
Some people consider this type of marketing to be evil to the evilest degree imaginable. (Made-up word #3, you’re welcome.) They see is it as “Profiting off of tragedy.” Whatever. When I die, you can HAVE my house and I hope you make a ton selling it. We’re actually doing these people a favor.
If someone receives your letter and calls you cursing you out, here is what I want you to do – remove the phone from your ear so as to not pollute your brains with anymore of their nonsense, place your finger on the “end” button (assuming you’re on a cell phone) and press it.
As a rule of thumb, I do not put up with any crap from anyone at any time when it comes to my wholesaling. People need me – I do not need them. You would be wise to do the same.
Want more?
Today’s lesson has definitely provided some great insight into the wonderful world of probate investing. But I have more. (Come on, you know me, of course I’ve got more!)
I created a special report that takes what we started here to the next level. You may or may not have access to it on Mogul, but’s called “Instant Probate Profit.” Or, if you’re ready to go all-in, check out of my “How to Get Deeds from the Dead” training, also available in your Library under Courses.
If you want to follow in the footsteps of the smartest and richest residential real estate investors on the planet, then you need to get to integrating probates into your acquisitions plan.
As Tony Robbins says: “Success leaves clues.” Well, your Mogul Library is riddled with them (clues, that is) including our two top-shelf pieces on probates.
Questions, comments, made-up words
Talk to me in the comments section below for all things probate (and made-up word funnies).
Don’t be scared of probate – it’s a highly-lucrative and less-competitive REI niche.
Head to the Mogul Library and check out the 2 probate trainings we offer.
Market to probate estates asap and watch the calls come in.
Preston Ely
is a real estate investor, serial entrepreneur, life coach, musician and philanthropist. CEO of Real Freedom, Inc, one of the most influential internet-based information publishers in the world, owns the largest Anytime Fitness Gym in the United States, is recording a music album with Atlantic Records, sits on the board of Advocates Of Love Orphanage, and has a non-profit charity assisting the poor and oppressed in Cuba with both their physical and spiritual needs.
With over 200,000 subscribers to his email newsletter, he is rapidly fulfilling his mission on earth, which is to glorify God by setting people physically, mentally, financially, and spiritually free through his music and his message of FREEDOM. Preston is 37 years old, lives in Tampa, FL with his wife Ashley, where he spends most of his time reading, writing, and practicing mixed martial arts.