Quitting your current job to invest full-time in real estate is an important decision. Fear is the biggest roadblock we put in front of ourselves, even if what we fear will change our circumstances for the better. Unless you are financially able to support yourself for one year while you get started, you’ll need to wisely prepare to quit your job before you take the leap.
Organize a room for you to work in. Be as focused as possible and be serious. If you treat real estate investing like a hobby, it will reward you as one. If you treat it like a business, you will earn a paycheck.
Quick books will help you keep your finances organized. A word processing program will help you put together your letters, postcards, or flyers that you will use for marketing campaigns.
Next, build your team. You will need a closing agent who is investor friendly. Money… find your local hard money lenders (usually at the investor club) and introduce yourself. Find out what their lending criteria is, how fast they can perform and what terms they offer. Lastly, gather a small group of friends, family or teenagers who share your excitement and enthusiasm. A simple desire to earn extra money will do. Tell them that you are beginning to invest in foreclosed and distressed properties. You want them to share the experience, so you are seeking sweat partners. A sweat partner is someone who will help you market and bird dog to find sellers.
It is imperative that you know your numbers. You must track where your leads come from; how much it costs to generate a lead from the above source; how many leads turned into deals. Lastly, how many accepted offers do you need in order to close one deal? When you track the answers to these questions, you will be a marketing dynamo. Your profit will increase because you know exactly where to market to get the results.
Once you have determined your budget and how much you must earn in order to change careers, it will be easier for you to determine the number of deals necessary to earn those figures. One of the biggest mistakes new investors make is that as soon as they find a deal, they begin to work it using all of their time. Meanwhile, they stop marketing to find more sellers.
This means that there is less competition at this level of marketing. Likewise, anyone can mail a letter and most do; therefore you will find your highest number of competitors mailing letters and subsequently you will receive the smallest number of deals at that level. Of course, these rules will be different for the investor who is in an area without many competitors.
Start with accessing public information regarding foreclosures, bankruptcy, evictions, delinquent real estate taxes and probate. You can subscribe to services that provide this information via the internet or you can go to your local courthouse and access it yourself. Once you have the addresses of the properties that appear to be “in distress”, you now have a basis on which to perform your marketing.
Door knock folks into foreclosure. Properly plan your time so you can knock one to two doors on your way home from work each day and several on Saturdays. Simply run through the list of folks in distress, map out the locations and route your drive home from work accordingly. What will you say…?
Hi, my name is _________, and my company specializes in helping folks find real solutions to their real estate problems. We (if you are with another person) came by today to see how we could help you. How can we help you?
You must practice asking questions that do not require a “yes or no” answer. In a way, you are surprising the seller who may not understand exactly what “public records” truly means. The seller probably wants you to go away, but if you can invoke conversation, you will do more deals. You must prepare to handle the objections that the seller may have against selling so you can be a better negotiator.
Caution: You never know who will answer the door, so be careful!
Do you like to talk on the telephone? When public records reflect the seller’s phone number, simply call and use the same script with the obvious changes to speak with a seller about making an appointment. There are several internet search sites available to help you locate sellers and their contact numbers when public record runs short on data. One advantage of this method is that you can reach a lot more people by telephone than by driving around knocking on doors.
Each time you change the wording, you must track the marketing all over again. If you are absolutely stuck on mailing campaigns, then try multi-mailer campaigning. This is when your customer receives more than one mailer from you. In order to be the most effective and to obtain the best results, the least amount you should mail to expect a response is five. If you invest in an area with a short foreclosure period, then your mailers must go out nearly every other day from the time the foreclosure is public record. If the process is longer, then mailing weekly will suffice.