How to find motivated sellers ??

Question

Hello BP members,

I am 19 years old, and I've been contemplating on wholesaling.

I've done my reasearch on how to become a wholesaler but, I have a few questions for you all and hopefully you can give me some helpful insight.

I think I have a reasonable method on how to attract buyers.

1. Post ads on Craigslist

2. Post ads on the biggerpockets marketplace

3. Call/advertise to hardmoney lenders

4. Advertise my at local REI club

5. Advertise to companies like "We Buy Ugly Houses"

6. Bandit signs

As far as finding motivated sellers, thats where im still kinda stumped.

1. Direct mail campagain (which i think would be the most affective)

2. Bandit signs

Another thing is,

what do i say to a motivated seller once I find one?

How do i figure out how much it'll cost to renovate the property for the potential investor?

Larry Turowski · Answer

@Marlon Thomas Buyers are easy.  Worst case scenario, split the deal with other wholesalers who already have solid buyers lined up.

Finding motivated sellers is the rub.  For off market properties you have to advertise.  To advertise you generally send mail to potentially motivated sellers (I don't do bandit signs) or call if you have their number through a referral.  To find potentially motivated sellers, tell everyone you know you buy houses, drive your target area and write down addresses of houses that look distressed, buy mailing lists (non-owner occupied houses, people in default--though I wouldn't do this one if you are not taking ownership, high equity homes last sold 12 or more years ago.

So  potentially motivated sellers will call you.  Most will not actually be motivated.  Some small percentage will be.  I like to tell people I'm not looking to convince anyone to sell at a price they are not comfortable with.  I prefer to simply buy if they are selling at a price I can pay.  Then I say, "With that in mind, what are you looking to get for your house?"  If they don't want to give a number they are probably not motivated.  Explain again that you want them to be comfortable with the price and ask again what price they comfortable with.

When they give a price, repeat it as a question.  "$100,000?"  They'll usually elaborate and you are looking for them to say things like "in that range," or, "I'm negotiable on that."  Now repeat this response.  "So you are negotiable on $100,000?"  You might even go through several iterations of this.

You might want to wander away from price and talk about the house or what you do or anything else, then come back to the price and ask them again. "So you are looking for $100,000 but you are negotiable?"

If it sounds like a potential deal make an appointment to see the house.  As a beginner you may want to see every house as it will help you in comparing homes and values and you can practice your terrible negotiating skills with the knowledge that you knew it wasn't going to be a deal, anyway.  Otherwise, explain that that wouldn't work for me now, but if they think they can be more flexible in the future, please call back, you'd love to buy the house.

Ethan Summers · Answer

@Marlon Thomas

Direct mail is a good way to generate initial response be sure to keep in mind that traditionally it takes a few mailers to get connected with a motivated seller. Trust me you wont be the only one mailing and marketing to these individuals. Im a firm believer on follow up and creating systems that help you stay on top of leads that aren't exactly motivated when you first establish contact. In my opinion Omnipresences should be your goal with your marketing you want to be seen/ heard EVERYWHERE! There are some great direct mail companies that will help you manage and set up your direct mail campaigns.  I have never personally used marketlikeawholesaler.com but have read great reviews online and the owner has been on the biggerpockets podcast episode 21!

In regards totaling repair cost this is a skill that is developed over time as you work on more deals and learn more. My advice is to reach out to an individual who is already experienced in calculating repair cost and bring them into the deal to help you with that side of the transaction this is extremely important to get right if not you'll lose credibility with your buyer as well as the potential seller you're working with. Feel free to PM me if you have any questions i hope this helps.