Calling Home Owners Right Before Their Foreclosure Acution
I am calling homeowners in the end of the foreclosure process, as soon as I see the Legal Notice in the newspaper that provides the auction date (usually about a month from the date the Legal Notice is published). I am not having much success when speaking with the homeowners. Does anyone have a ratio, at this late stage of the foreclosure process, based on the number of homeowners one speaks to ****Must Reach Freshman Investor status before posting URL's***he number of homeowners that would be willing to meet with you and speak about the possible quick sale of their home for ca$h.
I like to work the back side as well. At this point you need to get in front of these people eye to eye... yep knock on the door, nothing beats it and you will make many deals this way as alot of home owners have a hard time looking at the mail or returning calls, heck some dont think there is any thing that can be done and need you to take them step by step through the problem and into the solution.
Dear Robert,
My you do like to work close. Of course you are in a position that you may be the last person offering to help. You have to watch what you say, it is not just I will buy your home. You have to arrange a sit with them and go thru every possibility and at the end when there is only one or two paths possible, then lead them to select whichever one is best for both of you.
You should be prepared to offer more solutions then just signing over the home to you to help with their future credit.
Before I stopped running as I am so busy trying to convert ISO shipping containers into houses. I was prepared to do almost everything that can be done in a foreclosure situation.
If there was sufficient equity, I was prepared to repair the home and make it marketable, then split the net profit with the then Homeowner. I was prepared to place a loan on the property to bring it out of foreclosure while I offered it for sale. I was prepared it the earnings were sufficient and the reason for the foreclosure was some small bobble to even make a bridge loan while they got back on their feet. I had side lenders standing by who would make almost any kind of a loan if I gave a recourse on it. And I was prepared to do that.
I have run after ex husbands or wives to obtain Quit Claim Deeds so a refinance could be effected or even a proper sale. I was prepared to do accellerated closings in one day to beat a foreclosure in the door. I if necessary would file an action restraining the sale. I would assist in the filing of a BK 13 or 7 if that was the only way to go.
Accordingly If I could talk to the person on title, the homeowner I would have a deal. Some good, some close but all of them capable of some sort of profit to me either in earned fees or profits on sale or partial profits on sale if the homeowner was still involved.
To do proper running you must have that ability. If you have it you can do well, without it you miss a lot and in most cases just a simple assignment of interest does not happen.
I hope all of this makes sense. I am trying to prepare you for proper running. When you hit that door and it opens, A want you to have a transaction.
Cheers Lucius
The majority of the properties I buy in this category are made at the eleventh hour. Just keep calling you'll start buying soon.
I agree with Lufous be sure you can finnish the deal you suggest to the seller as this is the last chance they may get, so be careful and perform, if you are not sure then bring in a partner that can push the deal through with experience /funding or booth. Yep it would stick to have some one bumble and drop the ball when another investor could do the deal no problem. I offer my best solution and if they are not ready or interested I keep my phone open to them with as much help as I can give them, even to help them negotiate with another investor. I agree with Sammyvegas this is the time when deals are made.
As Lufos so eloquently pointed out, you must develop specific skills to make it work.
Consider yourself in the Intensive Care Unit of Investing. You need a number of tools in order to be succesful here.
Here's just a few.
Cash is King. You need access to it 24/7, 365 days a year. Without it you are not a serious player.
The ablity to get the distressed owner to sit down with you and discuss his predicament. Read up on the psychology of people under stress.
Learn to listen and analyze, listen and empathise, listen while quickly running numbers in your mind, listen and gently guide the conversation. The word is listen.
Having at hand all documents that could possibly be used and the knowledge how to word them for your deal.
Develop the ability to discover where the deal is. That means recognising hte motivation points of the owner, and working with those to point him the way out of the threat of foreclosure, and you into a profit.
Don't be put off in the beginning by not getting in through the front door.
As you gain experience you will improve your techniques, and you will be succesful.
Foreclosures pop up like mushrooms all the time. Keep it up and you'll get your share.
...just some thoughts to help you along.
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Great post Hawthorne!
Cash if definitely king. Cash for keys!
Get to the front door.
Jeffrey Adam
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If you can get a 2-3% close rate this would be good. A 5% rate would be excellent. A 10% rate would be exceptional,and I want to take your sales seminar. Remember most of the people who you will contact are in denial and feel that they can work it out or that a miracle will happen. I have found that the sooner you get in contact with the homeowner the better. Keep us informed of your successes. [ Edited by MichaelChandler on Date 02/05/2004 ]
Hawthorn, nice post!