Buying Distressed Properties

There are 3 main ways to buy distressed properties.

Foreclosures, short sales and real-estate-owned (REOs) are all distressed properties but aren’t all the same.

The three types of distressed properties do have similarities. For instance, most short sales are foreclosures, however not all foreclosures are short sales. To further complicate matters, REO’s are not short sales but some intended short sales can end up as an REO.

Here are the basics about these distressed properties:

Distressed Properties-Foreclosures:

A foreclosure is official when the notice of default has been filed in the public records. It means the owner has stopped making mortgage payments (usually behind 2 or more payments) and the lender has given notice that unless the payments are brought up to date, it will sell the property to the highest bidder.

Not all homes that fall into foreclosure go to public sale because owners have the right to make up back payments up to a point, the time which varies from state to state.

Foreclosures are typically profitable real estate deals because investors and home buyers buy the distressed properties for the amount owed, picking up the home owner's equity for free.

As an investor, before you decide to buy a home in foreclosure (in California) by making up the back payments to the lender, giving the seller a few dollars and recording a deed, call a real estate lawyer.

Distressed Properties-Short Sales:

A short sale is when the lender agrees to accept less than the amount owed on the mortgage for distressed properties. This happens after a distressed property goes into foreclosure but before the distressed property goes to public auction.
Investors can typically buy the home for even less than a foreclosure because investors are not paying off the existing mortgage or paying back payments.

Sellers don't need to be in default and it isn’t necessary for the properties to be distressed in order for a short sale to occur. For a buyer who wants to occupy the home, buying a short sale makes financial sense.

Distressed Properties-REOs - Real Estate Owned:

REO or real estate owned distressed properties are similar to short sales except the property has already been repossessed and is by the lender.

Lenders usually end up owning distressed properties if nobody bid high enough (to cover the mortgage owned on the property) when the house went to public auction.

Generate real estate leads using direct marketing

The are endless types of direct marketing that can all be used to generate real estate leads for real estate investment companies. Each type of direct mail is used to attract different types of real estate leads and to market different types of real estate solutions.

Direct mail can create real estate leads fast if used effectively. However it can also be a huge waste of money if you chose campaigns that don’t work.
Some common types of direct marketing are: direct mail (post cards, mailings, all in one mailers), direct email, personal selling, and telemarketing.

In order for direct mail to be effective at generating real estate leads it has to make an impact. You want potential customers to look at it, not think of it as junk mail.

Once the homeowner reads it, you need them to take a specific action. The direct mail should make it easy for the motivated seller to respond to the offer. Follow up is integral either by sending additional mailers or telemarketing.

To perfect your direct mail marketing plan geared towards generating real estate leads you need to answer these 5 questions:
1. Who will you target?
2. What do you want to say?
3. What format should you use?
4. How will you follow it up?
5. How will you track the results?

All marketing should be tested in smaller markets to learn the return on investment. If you can’t seem to perfect your marketing system or if you want to save time and money have Wehavehomeleads.com generate quality real estate leads for you.

To learn more visit www.Wehavehomeleads.com.

Social networking your blog and real estate investment company to success

In order to have a blog that is successful and leads to your real estate investment company’s success it has to be clever, relevant, and informative. A great way to connect with potential customers and other real estate investment professionals is through various social networks on the web.

For those that aren’t familiar, social networks are online communities for internet users to unite and network with others. Currently, myspace.com and facebook.com are very well-known examples. Even though these are not business websites they are excellent resources to generate traffic to your blog and website.

Here is our list of the top five social networks real estate investors should join to increase their presence on the net so potential customers can find and learn about them easily:

ActiveRain (www.activerain.com)- Real estate professionals gather and share real estate and mortgage information via their ActiveRain blogs. This site is free, could generate new business contacts and increase traffic to your blog and website.
Squidoo (www.squidoo.com)- Group of member sites called "lenses". You create a "lens" regarding a particular real estate investment subject. This is a free website that could potentially lead to ad revenue, and create more traffic to your blog and website.

HubPages (www.hubpages.com)-This site is very similar to Squidoo. It’s a group of other member sites called "hubs" rather than “lens”. Again it is free and the benefits are the same as Squidoo.

Facebook (www.facebook.com)- It was created to connect college students across the country. It is now common for users of all ages and businesses to use for promotion of their service/product/brand. You can create a free profile page for your real estate business quickly and include a link to your blog and website.

Twitter (www.twitter.com)- This website doesn’t allow you to write a full blog. Its purpose is to quickly spread information about your company whenever you update your account. You answer the question: "What Are You Doing?” Your updates will attract "followers" that can become real estate leads.

Creating and maintaining these sites can be a lot of work but it pays off when the real estate leads roll in!

Motivated Seller or Waste of Your TIME? Tips on how to qualify a seller…

All investors need practice talking to people and negotiating when we first start out in this business. Time is money in business so don’t waste your time on the phone, in person or making offers to sellers who aren’t motivated. Save time by learning how to read sellers quickly and if it isn’t going to work, move on to the next potential deal.

When talking to sellers take it slow and don’t be over eager. It is important that you ask specific questions to learn if they are motivated or if this is a waste of time for you.

To qualify sellers find out quickly if you are dealing with a motivated seller who is open to a creative offer. Motivated sellers are few and far between and making a creative offer to someone that isn’t motivated will frustrate and waste both yours and the seller’s time.

There are two major ways to make money as an investor-get a good price or good terms. Buying a house at a low price allows you to sell a house quickly for profit. Good terms means that you get to control the property without putting much money up front and you make your profit after the property value goes up. It can be difficult to get a good price. It is typically easier to find a motivated seller that is open to terms. The seller is happy because they get what they want even if they have to wait a few years for their money. Every job is easier if you feel like you are helping others and allowing them to be happy.

Back to the beginning-when talking to a seller the first question to ask is: Do you need all of the equity out of your home in order to purchase another home? If so, they need to sell to a traditional buyer and this deal would be a waste of your time. Thank them for their time, wish them luck and move on to the next potential deal.

If the seller answers no, then continue with your phone call. The next question to be answered is are they willing to look at a creative offer. One way of doing this is to inform the seller that you invest in a number of ways and you are trying to decipher which is best for their situation. Let them know that sometimes you lease a home for a year or two then cash the seller out at the end. Ask them point blank-will this work for you? If they answer yes, it’s probably worth a visit. If the seller says no, move on to the next deal.

Once you’ve established that this is a motivated seller the next step is reaching a deal. It’s a good idea to start your negotiations on the phone. In order to get a good deal you need to get a rough idea what the seller is thinking. For example, I’m not sure that I could offer you this exact deal; obviously I’ll need to see the house. But if I were to offer you rent of (__) and a price of (__) in 2 years. Would that work for you? If not, what did you have in mind?

Hopefully you can negotiate in person with the seller and be able to get your price down a bit from the numbers mentioned on the phone. Of course if the seller seems unwilling to budge or negotiate move on to the next deal.

Why Use a Real Estate Lead Generation Service?

A real estate lead generator service connects motivated sellers with real estate investors.

Real Estate lead generation involves putting homeowners that are desperate and/or very motivated to sell right away in touch with real estate investors that are looking to buy and make money. The real estate lead service is contacted by the sellers asking for help in finding an investor to buy their house fast.

Wehavehomeleads.com is a lead generation company that asks tons of questions and compiles detailed information regarding the seller’s situation, property, and mortgages and listing status. This is VERY helpful to investors because it saves them time. The investor not only doesn’t have to spend the time asking questions, the lead information also allows the investor to know their purchase strategy before ever speaking with the seller. We all know that time is money in business.

Once all the information is gathered a team of real estate lead professionals decide if the lead is quality and has enough equity to send to the subscribers. If so, the real estate leads are emailed to the subscribers in real time. If not, the leads are tossed and considered a waste of time. Endless amounts of time and potential profit are spent and wasted on marketing attempts to find real estate leads. A real estate lead generator guarantees quality leads in your area will be emailed to investors daily.

It is a great idea for beginner and veteran investors to use a real estate lead generation service because it will increase your profits. It is equivalent to hiring an entire team of marketing and real estate lead qualifying professionals. This allows the investor a fixed monthly cost for marketing with a guarantee of success, more time to focus on closing deals and making more money!

Not all real estate lead generation companies have the same high standards as Wehavehomeleads.com.

What can a Real Estate Lead Generation company do for you?

A real estate lead generator is a service that connects motivated sellers with real estate investors.

Real Estate lead generation involves connecting with homeowners that are desperate or very motivated to sell now. The real estate lead service is contacted by the sellers asking for help in finding an investor to buy their property.

The lead generation company asks tons of questions and compiles detailed information regarding the seller’s situation, property, and mortgages and listing status. This is VERY helpful to investors because it saves them time. The investor not only doesn’t have to spend the time asking questions, the lead information also allows the investor to know their purchase strategy before ever speaking with the seller. We all know that time is money in business.

Once all the information is gathered a team of real estate lead professionals decide if the lead is quality and has enough equity to send to the subscribers. If so, the real estate leads are emailed to the subscribers in real time. If not, the leads are tossed and considered a waste of time. Endless amounts of time and potential profit are spent and wasted on marketing attempts to find real estate leads. A real estate lead generator guarantees quality leads in your area will be emailed to investors daily.

For most investors, it is a great idea to use a real estate lead generation service. It is equivalent to hiring an entire team of marketing and real estate lead qualifying professionals. This allows the investor a fixed monthly cost for marketing with a guarantee of success, more time to focus on closing deals and making more money!

I learned about this process by interviewing Art Smith co-owner of Wehavehomeleads.com. He warns that not all real estate lead generation companies have the same high standards and/or as Wehavehomeleads.com.

What can a Real Estate Lead Generation company do for you?

A real estate lead generator is a service that connects motivated sellers with real estate investors.

Real Estate lead generation involves connecting with homeowners that are desperate or very motivated to sell now. The real estate lead service is contacted by the sellers asking for help in finding an investor to buy their property.

The lead generation company asks tons of questions and compiles detailed information regarding the seller’s situation, property, and mortgages and listing status. This is VERY helpful to investors because it saves them time. The investor not only doesn’t have to spend the time asking questions, the lead information also allows the investor to know their purchase strategy before ever speaking with the seller. We all know that time is money in business.

Once all the information is gathered a team of real estate lead professionals decide if the lead is quality and has enough equity to send to the subscribers. If so, the real estate leads are emailed to the subscribers in real time. If not, the leads are tossed and considered a waste of time. Endless amounts of time and potential profit are spent and wasted on marketing attempts to find real estate leads. A real estate lead generator guarantees quality leads in your area will be emailed to investors daily.

For most investors, it is a great idea to use a real estate lead generation service. It is equivalent to hiring an entire team of marketing and real estate lead qualifying professionals. This allows the investor a fixed monthly cost for marketing with a guarantee of success, more time to focus on closing deals and making more money!

I learned about this process by interviewing Art Smith co-owner of Wehavehomeleads.com. He warns that not all real estate lead generation companies have the same high standards and/or as Wehavehomeleads.com.