Contacting Owners of Foreclosure Properties

[Sharon Thorson]

  Hi All, 

  I just finished responding to a post by another BP member about contacting the owners of Foreclosure properties.  I thought I would post my response here as well in order to share my journey thus far as a newbie investor: (I revised my response because I forgot a few things!)

   I live in Temecula, CA (Near San Diego County) and I'm currently in the process of locating Foreclosed properties slated for Auction. My daily routine (in no particular order) is:

1. Driving for Dollars - This is really putting your finger on the pulse, and a great way to get to know the neighborhoods you want to invest in (or finding out the ones you really, really don't!)

2. Searching the MLS (I have access since I'm an Agent) - Unfortunately, there are very few Foreclosures in my area that are listed on the MLS, and if they are, they generally or not very good deals, which I find out by analyzing the properties using the BP tools and my own Excel Spreadsheet I created.

3. Searching Craigslist for FSBO's, - Again, very few ads even come up for these and they are spotty as far as locations I am interested in.  I'm finding that most ads are being placed there by Agents, so not off market like we are all looking for, but this could be different in other parts of the state and country.

4.  Checking Auction sites - If I find the property to be of interest, I will drive over there and check it out.  Then, research the owner and try to contact them.  So far I have been able to speak with neighbors and left notes on doors, and even had one neighbor offer to contact the owner and give them my information.

5.  Search the Title Company site that a Rep gave me access to- I can search for Foreclosures in specific areas and create a list, then pay 0.06 cents per record. The next step is to send the owners a postcard.  I will also be attempting to obtain phone numbers, but haven't got that far yet. 

6.  Place an ad on Craigslist offering to Buy Homes for Cash - So far no responses, but I continue to renew my ad and change it up each time.  In my area there are literally hundreds of similar ads posted, as this is a highly competitive market!

7. Analyzing deals - I am continuously analyzing deals using the BP tools and my own Excel Spreadsheet.  At first it was VERY time consuming, but the more I do it, the faster I get!

  All this while being a single Mom to 3 kids, (my youngest has been pulling on my arm the entire time I am writing this post because she wants me to watch YouTube Videos with her, but I have to tell her Mommy is working, just give me 15 minutes which could be a topic for a whole other post!)

  I've been at this pretty much daily for about 3 weeks now, but haven't received any solid responses...YET.. I'm NOT GIVING UP!

  I have some friends who are successful Investors and they have told me in my market I will get about a 1/2 percent response rate to any DM, and that's just people contacting me, then I will still need to vet those calls and try to secure a deal. One of my friends sends out 5000 postcards per month! Unfortunately, I don't have the budget for that now, so it's all on me to do as much of the grind as I can.

  Everyone wants the easy, simple answer to how they get Foreclosed properties, but the truth is, it takes time, energy, research, networking, studying, money for advertising/gas/marketing materials, etc., and most importantly, persistence!

  In the next few weeks, I have no doubt that I will be posting on BP that I have secured my first property, because I am willing to do whatever it takes to get the job done!

[Jeff Filali]

@Sharon Thorson Wow, You are definitely willing to put in the grind to get started.

I'm not in Cali, but my business model is primarily built around foreclosures, I would say at least 75% of my acquisitions have been foreclosures, and I've acquired around 30-35 properties since I started investing in real estate 18 months ago.  Most I rehabbed and sold, some I wholesaled to other investors to flip or keep as rentals, and I've also kept 11 myself so far.

Anyway, here's my experience with the methods you're using:

1. Driving for Dollars - I rarely ever do this unless there's a specific property I'm going to look at, or if I see a FSBO sign while driving somewhere. If so, I will drive the neighborhood around those homes. I think D4D isn't very productive from my experience other then if there's a property you're already interested in, or like you said getting to know neighborhoods, but again this can be accomplished once you have a potential deal to go look at.

2. Searching the MLS - I know that most the foreclosures on MLS are not good deals, however I have had some success with this method. The listed price on MLS is typically approximately the balance of the mortgage or an estimated value. I've found you can acquire some of these properties for a much lower price. I still research every one of these and any I am interested in, I put in my lower offer.

3. Searching Craigslist for FSBO's, - Most of these are usually wholesalers from my experience, but once in a while you find a deal on there, and it doesn't take long to search them, especially since you can sort by zip code radius, price range, etc.

4. Checking Auction sites - I've purchased several properties from Auction sites.  However I rarely ever go to the initial sheriff's auction on foreclosures because I've found the majority of the time the bank will buy the property or it will sell for too much.  But once its listed on auction sites as bank owned, I've had a lot of success buying these, in fact bought one last week.

5. Search the Title Company site - I've never tried this, but will be asking my title lady about it.  Thanks for this idea!!

6. Place an ad on Craigslist - If CL in your area is like it is where I operate its full of wholesalers ads "We Buy Homes" etc.  But these do generate some leads for me.  I place 2-5 different ads once a day, and renew them every time CL allows renewals.  I have them pre-typed out in a word doc and just cut and paste, saves a ton of time.  I think this method is worth the time because its free and doesn't take much time.  I've found ads that seem like a company or big investors do not get near as good a response as one that seems like a local individual.  I run both types but one ad that I have received the best results from simply says "My Wife and I Are Looking to buy Fixer Upper Homes (References Available)"

7. Analyzing deals - Keep this up.

OTHER METHODS-

8. Website and SEO - if you do not have a "Cash Buyer" website set up yet, this is the first investment I would recommend.  I use Investor Carrot site, their basic site is only $49/mo which is all you need at first if only using it to acquire leads.  They have all kinds of free tools, and walk you through setting up SEO.  In my markets if someone googles "sell my house" or many other terms, my website comes up as one of the top 1-3 on the first page, it takes time for your site to rank that high, but once it does, you will get a lot of free leads.

9. FaceBook Ads - I do very well with these, they can get expensive, but it only takes one good deal to make it worth the investment.  I average spending around $100 per lead, and of course many of the leads want too much for their property, but I typically land a good deal that I close on with every $2,500 invested in ads.

10. GoogleAds - This can be expensive also, but it can generate specifically targeted leads.

11. Direct Mail - I don't do much DM, just never had very good results on the campaigns sent for the cost, and in my markets everyone is doing DM.  I do keep preprinted post cards on hand, to send out though.  And I also like to send hand written cards.

12. Business Cards "2 Cent Billboards" - I buy generic business cards 10,000 at a time that just say "WE BUY HOMES, ANY CONDITION, ANY LOCATION, etc with my website" and always carry a box with me, and leave small stacks everywhere I go. I also leave them with other people and ask them to give them to anyone they know. If you order from VistaPrint 10,000 at a time, even with shipping they only cost around 2 cents each. 

13. Bank REO list - This is another source for foreclosures I've used.

One other suggestion, and you're probably doing it already, but make sure everyone you know knows you're looking to buy properties.  I get a lot of referrals from friends and family, because I always talk about my business, so they refer anyone to me they know looking to sell.

Good luck!! Keep grinding!!