Bird Dog Fees?
Curious to know what a typical fee structure looks like for a good performing dawg?
I've had a few contact me but their needs/requests/demands seem to be all over the place. What are investors handing over in return for good deals?
Quote: What are investors handing over in return for good deals?
Usually cash.
How much depends on you. I would try to figure out how much time you spent on a lead. Then decide how much you think your knowledge is worth per hour. Go from there with the investor.
Once you work out a structure with a particular investor that you are happy with, use that as a baseline with other investors.
I have an agreement with one investor for 10% of the selling price.
With that in mind, I provide him with ROW info, a documented title search for him to look at, Plat maps (if any), tax evals, and walk the property. From the walk I glean info for him to determine suitability for his purposes, i.e. old survey markers, take photos at strategic places to show views, streams, assets and generally give him all the preliminary info he needs to see if he even wants to look at the deal.
With some other investors, I add a price per acre and offer them the deal as a flip.
They do not have a problem with this as long as the value is still a bargain to them. Each of these deals are done and concidered on an individual basis.
I am trying to put details together to provide a "service" to investors that I will get paid for doing the leg work on deals they may be intrested in but don't have the time (or strength to walk and look at mountain property) to investigate.
A counsellor of sorts, not real advice but info for the investor to look at and determine what he or she wants to do next (if anything).
How much should a bird dog charge an investor for an apt bldg deal let's say in the range of $100+??
I have 2 things interested investors must complete before I do ANY work for them.
One is an investor Profile worksheet. This tells me the area they want to invest in, the price range, types of properties, etc., etc. and discloses they must send me their pre-qualification from their lender for the amount they say they can purchase up to.
The second is an agreement. This outlines fees, disputes, timeliness & form of payment, etc., etc. I charge 1.5% of the total purchase price which includes pics of the property sent to them via hyperlink (I use a free service called Snapfish but there are many others incl Ofoto, Kodak, etc.), a property condition report, and property details report (which incl list price, SF, pay off amounts to lenders - when/if avail., etc.)
Once these things are completed, I look for properties. Once I find ones that suit an investor, I send them a Property Availability Form. This form basically gives a street address but nothing else (city or zip) and has the investor sign off stating they have no prior knowledge of the property (covers me per my agreement they signed above to get paid!) and that they have or will disclose the names of anyone they convey my information to. Once I have this signed off on, I send them the pics and reports.
So far these are working wonderfully for me. If anyone has any improvements to this system, I'm all ears!!
You've got to provide a service and set yourself apart from all the others out there. I represent myself as a Full Service Property Locator - NOT a Bird Dog and I let investors know I am not a Bird Dog. Bird Dogs typically just scout out properties and give addresses. As an investor myself, this is really not useful info.
Hope this helps. Let me know if I can assist anymore.
Jenny
realestate411
Again thank you for the Property Locator AGreement template you covered it all. It's funny how I created a rough draft version the Property Profile sheet. You are soo helpful with your ideas. Question: do you charge 1.5 percent for apt bldgs as well (ie. more than 6 units)?
Thanks birddoggin - I'm glad I 've been helpful.
Yes - I charge 1.5% for any properties I locate. But that's just me. I know a locator who charges $3k for ANY properties under $100k and $5k for any properties over $100k. I know others who do a tiered system. I know others who charge based on the type of property. I like to keep things simple. This keeps everything neat and tidy! I would suggest, if you're locating mostly large apt bldgs then to reflect your fee to this - - maybe charge more than 1.5% since you're looking at more units for a given property. What I do in these instances is give my investors a brief synopsis of the property (withOUT full address - only a city) to see who is seriously interested. If I have at least one, then I'll go check it out. If I have no takers, I don't waste my time doing a site visit.
Let me know if you want to check out my profile worksheet. I think it's pretty complete and am always reviewing it to make necessary revisions! (i.e. I recently added a line where investors need to tell me how many years they have been investing and how many properties to date they've purchased. This guarantees nothing, but usually weeds out tire kickers and keeps only serious and experienced investors in your database).
Hope I've been helpful.
Jenny
Yes I would love to check out your profile sheet. Thanks again for your valulable input. You can email it to me at **Please See My Profile**
I've located a rehab property and would like to bird-dog it to another investor, but am not sure hjow to go about it.
Could anyone give me an idea on how to draft an agreement to make sure I get paid for the work I did?
Thanks in advance.
To realestate411
Your post and tips about bird-dogging sounds intersting and helpful.
I wld appreciate it too if I can get a copy of your template "Property Locator AGreement" or any contract between yourself and your investor, or in my case if i find the buyer for the Seller, (see my post earlier).
Looking forward to it.
I am a birddog and I typically charge $800.00 per lead.
I know this has been talked about elswhere, but I am still unclear, but realestate411 - do you work in a state that does not require you to have a licence? Do you have a RE Lic?
Comments?
(FYI I am an active investor in income prperties and land and have never used a locator other than a lic. realtor. )
[addsig]
GFous,
Let me help you out with your dilemma about Bird Dogs.
The local Real Estate Boards impose regulation relevant to the distribution or aid in distribution of a homestead with the intent to protect the consumer (and in some rare cases monopolize the marketplace).
Whether or not this legislation is put into place in a criminal or a civil context, it does appear fairly evident that the enforcement of this legislation would be limited to that of:
a) When a consumer is being blind-sided (ie: you are acting on his or her behalf without proper licensing and steering him/her wrong)
b) You are continuously taking a "fee" for selling real estate.
If you are working with an investor, and you are paid by the investor, who has experience in real estate transactions, and you are not party to that transaction (ie: a consultant) you should, (this is not to be construed as legal advice) be ok, for the following reasons:
1) You are taking a fee for selling information, not real estate (nobody can prevent you from charging $5.00 to tell him or her were the nearest gas station is, or where the nearest "deal" is)
2) Even if legislation was in place to protect the consumer, you have conducted no harm to the consumer....so in a semi-perfect world, you can indeed pay for a lead on a house!
I think it is important to know, most investors are opposed to the local Real Estate Boards attempting to corner the market on Buying/Selling properties, I am certainly of the opinion that the local Boards would like to see no investors/creative RE at all so that they can continue to take a small chunk out of every property sold and have the properties sold according to their "rules & regulations".
There is also such a thing as a simple Partnership Agreement, thereby making you and the investor principals in the transaction. The Bird Dog is bought out of the Partnership by the investor, thereby violating no State Statute.
I believe this should help you understand that you do not need a license to Bird Dog. If you have only been using agents then you are missing the best part of creative real estate investing and paying more for properties than you should have.
John $Cash$ Locke
John,
Thanks for that thorough explanation. I particularly like your analogy of paying someone for directions to the nearest gas station. After all, I do pay my assisitant to do seraches, mailings, etc.
One of the other posts asked for an investors opinion of bird dogs ( re: approach) I told (Twinky) that I had never been approached but in general would be sceptical about an approach unless and until I felt that the "bird dog" was sharp and could be of benefit in some way.
( I had not heard the term until this forum a few eeks ago)
I have not read your course but am an avid reader of "guru" stuff (good and bad) ( Nickerson and Lowry's first book my personal favorites) but consider myself a sussessful R E investor , in fact I do it full time.
I learn from them all I certainly apprecitat your forums and commens.
Thanks.
[addsig]
John,
I am a new investor in New England, and want to make sure I am clear on some of what you said in your respone to GFous.
I want to make sure that it is perfectly within my legal right to not only birddog, but tie up properties myself so that I then assign those properties to an investor/rehabber who will have enough margin built in to make it worth their while.
So I guess what I am doing is not JUST birddogging, but seeking to make offers, have them accepted, and make more money assigning than just birddogging.
Is everything on the up and up with that strategy? Just want to be clear from the get go, thanks a bunch! - Dave
Hello there! It's been a while since I've had a chance to post any replies!!
To answer the question about if I have an RE license - no I do not and since I do not, my fees are to give investors information. My agreements with them clearly state I am not a licensed agent and will not assist in real estate advice. I also clearly state I will not personally prepare any contracts to submit offers to purchase. I mearly provide information. For this, I do not need a license.
Also, I've been getting a ton of requests for the worksheets & agreement I use when I locate for investors. Unfortunately I do not have the time to field all the requests. (I had no idea I'd get such a reponse) However, I will try to place some or all of what I have in freebies as soon as I can. I hope that will help. For those of you who I have not been able to respond to, I do apologize. Locating is not all I do, in fact, investing is first and foremost with locating as an added income stream and service. For those who I have been able to respond to, I hope what I've sent has been of help.
Thanks everyone for your positive feedback. Best wishes to everyone who wants to be a locator and/or investor.
Dave,
As far as locking up a property and assigning it to aninvestor, its my opinion that your really a investor that is assigning the property to another investor. If you couldn't find a buyer, you would have close on the property making you the "buyer" or investor buying the property.
Bginvestor
depending on the work performed and the deal at hand... I pay anywhere from $100 to 5k to bird dogs.... depends on the deal at hand and whats supplied...
Quote:
On 2003-10-02 12:09, davehays wrote:
John,
I am a new investor in New England, and want to make sure I am clear on some of what you said in your respone to GFous.
The responce was general in nature to make a point. John $Cash$ Locke was telling the poster to think outside of the box, and giving the poster a possible way to get paid for information.
If you want an answer to the question of: Is this legal where I live? You need to seek the advice of competant paid counsel who is well versed on the law in your area.
Most posters here are more than willing to offer advice, including myself. But we do not know the law where you live. So please do not ask us to explain the law in your loacation. If you do the advice will be worth what you paid for it.
[Please send me a copy of the worksheet it sounds like a great idea
Have agreat day
Tim
I have a couple of Bird Dogs that find and secure deals for me. I provide access to three different subscription pre-foreclosure services, an office to work out of with admin help, rehab estimates, 40 years of successful business expertise and the MONEY (personal funds) to buy the properties.
Normally I offer the Bird Dog a $1,000.00 minimum, $5K max, finders fee if I buy the property. Payable at time of my purchase.
At the moment, however, I have two Bird Dogs that want more participation --Once they decline a finders fee, they want to supervise rehab, market & sell the property and receive a percentage of net profit after resale closing.
I don't mind paying 50% of net profits if the property is sold within 60 days of purchase ( a flip) and 33% of profits if we have to occupy and rehab the property.
My Bird Dogs are asking for a written agreement to that effect, and I agree one is necessary.
The problem I see is that --on the front end-- I have already provided 95% of my responsibility, providing the forum and the money. At time of purchase they want a contract. And we don't know which way the deal is going to go, and how much the Bird Dog is going to work to accomplish, or at what point I have to jump in to salvage my investment.
MY QUESTION: Has anyboby worked out a Sub-Contractor fill-in-the blanks form that can be energized deal by deal? Or any alternative?
A joint venture agreement doesn't seem too likely since there is such a disparity in net worth, unless a trust was set up for each purchase. Any one have ideas on this?? John
realestate411, When you get some spare time could I get a copy of your Locator Agreement form?
Can someone give some feedback?
I have located several properties. I got the owners phone# and current address, pictures, and tax information. What other information should I get to make these leads good? I want to make sure I am offering a good service.
Always get an inspection clause when you get the house under contract. After the inspection has come back favorably, then get a title search to see if any leins are on the house.
Always get the house under contract first THEN get the inspection THEN the title search. I know many are confused about this but you want to make sure you have the house tied up before spending the money on an inspection and then a title search IF the inspection comes back good. If the inspection turns up something ugly, then negotiate for a lower price, OR cancel the agreement via your inspection escape clause.