Finding motivated sellers is the best way to close real estate investment deals. As a real estate investor (aka flipper) or wholesaler, it’s how you source motivated seller leads that separates you from the competition.
Time is money, and speed is imperative in this industry. Think about it: why would you waste your time trying to convince sellers that selling their house to you is a good idea when instead you could work with sellers who need to sell fast and are most likely to sell to an investor?
Through a combination of research and action, you can find homeowners with a strong need to sell, even at a discount. To identify a motivated seller lead, you need to know where to look and understand their distress factors.
What is a Motivated Seller?
In real estate, a motivated seller is a property owner who needs (not wants) to sell. They may have a strict timeline, need to sell in 30 days or less, and their need motivates them to be flexible. They are often willing to agree to a low offer price (10% to 30% below market value) and sell under favorable terms, like 0% interest, no money down, or a solid financing plan.
Reasons a Seller May Be Motivated to Sell
A property owner can be motivated to sell for several reasons, but they often have a distress factor. It can be external and/or internal. An example of an external distress factor is a vacant property that has been vandalized and needs extensive repairs, while an internal factor would be the stress of managing that property and associated costs. These factors motivate the owner to sell to get rid of the problem.
To properly communicate and identify distress factors, you should group sellers into segments, such as:
- Pre-Foreclosure / Forbearance
- Tax Delinquent
- Bad Tenants / Tired Landlord
- Damaged / Neglected Property
Each case creates a sense of urgency to sell. Understanding a lead’s distress and helping to resolve it is what secures you the deal. Oftentimes, a seller is part of different segments but also a specific personna. So understanding all aspects, as well as what causes the most distress, will help you know how to position yourself as the solution-provider.
How Do You Find Motivated Sellers in Real Estate?
There are a lot of ways you can find motivated homeowners, including:
- Public or courthouse records
- County foreclosure sales
- Local tax sales
- Open houses
- Estate sales
- Expired MLS listings
- Respond to “For Sale By Owner” ads
- Respond to properties that have been listed a while
- Work with a real estate agent
But is there a bullet-proof method to finding distressed properties? Absolutely!
A lot of investors and wholesalers purchase seller lists. These lists are available online for free, or you subscribe to the provider’s network in exchange for the list. These lists, however, are searched out by thousands of investors a day, thus depreciating their value. Also, this is only the first step. You then need to skip trace the list to try to obtain correct contact information, list stack to aggregate the information and prevent duplicates, and ideally do some sort of lead scoring to ensure you reach the most motivated sellers first. This is why Skip Tracing, List Stacking and Lead Scoring are the three powerhouses for real estate investing success.
Fortunately for you, if you are looking to streamline the process, saving you time and precious dollars, subscribing to GoForClose’s services will get you access to market exclusive data (if the market is still available), and skip tracing, list stacking, and lead scoring.
Word of Caution
Before starting your quest to find motivated seller leads, make sure to select the best and most desirable areas for wholesaling and flipping. Spending resources on sellers and getting contracts that no one wants is a waste of time and money.
The where is just as important as the who, and that’s why GoForClose created the Hottest Zip Code Finder. This free tool helps you find profitable market areas, right down to the zip codes, where sellers are motivated to sell and cash buyers are buying.
So You Got a List of Motivated Sellers, But How Do You Reach Them?
The answer is a great segmented marketing campaign with outbound marketing tactics. You’ll develop a series of messages that speak to each type of seller, then put them out through a series of channels.
Creating marketing campaigns and optimizing them for better results takes time, experience, and the right people. Marketing tactics include cold calling, texting (SMS), ringless voicemail, email, and direct mail (outbound), and PPC ads and social media ads (inbound).
Be persistent. If the seller says no at first, or maybe they’re “Not Ready to Sell (Yet),” follow up with them through automated campaigns and retargeting. A seller who is not ready today may turn into the deal of a lifetime in a few months.
But you also need to consistently follow up with the seller leads who indicated intent. It’s a dance of time and negotiation, which is why there is a saying in sales: the gold is in the follow-up. But how do you do it all? You probably don’t have the time to follow up with all the potential motivated seller leads AND the ones you’re already talking to about offers and contracts. What can you do to ensure no opportunities are wasted? The answer: outsource your marketing and focus on acquisition and closing deals.
GoForClose Finds You Leads and Does the Marketing, So You Can Close More Deals
That’s right! GoForClose can do all the marketing for you! From data to multi-channel marketing campaigns, using those channels mentioned above, we reach leads who meet your needs and real estate requirements in your market.
GoForClose is the only all-inclusive marketing agency for real estate investors and wholesalers, with data, marketing, and people. We enable you to grow your business by doing the marketing for you, the work that takes the most time and effort but gets you better deals.
If you have questions or are curious to know more, request a free consultation below.